Lowe's Companies (LOW) posted stronger-than-expected fourth quarter earnings Wednesday, while boosting its 2022 outlook, as the home improvement group grabbed market shares from its larger rival.
Lowe's said adjusted earnings for the three months ending on January 28 were pegged at $1.78 per share, a 33.8% increase from the same period last year and firmly ahead of the Street consensus forecast of $1.71 per share.
Group revenues, Lowe's said, rose 4.9% to $21.3 billion, topping analysts' estimates of a $20.31 billion tally. U.S. same-store sales rose 5%, compared to the Refinitiv forecast of a 3.1% decline.
Looking into the 2022 financial year, Lowe's said it sees revenues in the region of $97 billion and $99 billion, a $2 billion improvement from the higher end of its prior forecast, with same-store sales either falling or rising by 1% from 2021 levels.
Earnings are expected to come in between $13.10 and $13.60 per share, up from its mid-December forecast of $12.25 to $13 per share.
"We delivered another year of outstanding performance in 2021, as we gained market share across DIY and Pro through our Total Home strategy. I would like to thank our front-line associates for their tremendous efforts this year," said CEO Marvin Ellison. "In 2021, we increased comparable sales by 6.9% while generating over 170 basis points of operating margin improvement, with our relentless focus on productivity and enhanced pricing strategies."
"We remain confident in the long-term strength of the home improvement market, and our ability to expand operating margin," he added.
Lowe's shares were marked 4.9% higher in early trading immediately following the earnings release to change hands at $225.00 each.
Lowe's larger rival, Home Depot (HD), reported stronger-than-expected fourth quarter earnings of $3.21 per share, on sales of $35.7 billion yesterday, but noted that supply chain constraints, which narrowed profit margins over the holiday quarter, would likely persist into the coming year.
