Lowe’s Matches Q1 Sales, Reaffirms Outlook Despite Housing Headwinds

Lowe's Companies, Inc. (NYSE:LOW) is a prominent player in the home improvement retail sector, competing closely with Home Depot. Both companies are set to release their quarterly earnings this week, with Lowe's expected to report an earnings per share (EPS) of $4.24 and revenue of approximately $23.94 billion. These figures are closely watched by investors for signs of a market turnaround.

The home and garden market has faced challenges due to a sluggish housing market, tariffs, and high interest rates. These factors have led to consumer caution regarding significant purchases. As highlighted by PYMNTS, investors are keenly observing the earnings reports from Lowe's and Home Depot for indications of whether these headwinds are beginning to subside.

Both Lowe's and Home Depot have underperformed relative to the S&P 500 in 2025, as consumers have reduced spending on big-ticket items and expensive materials for home improvement. This trend follows a surge during the COVID-19 pandemic. Despite these challenges, analysts have not made significant changes to their EPS and sales estimates for Lowe's.

Lowe's financial metrics provide insight into its market valuation. The company has a price-to-earnings (P/E) ratio of approximately 20.50, a price-to-sales ratio of about 1.69, and an enterprise value to sales ratio of around 2.12. These figures reflect the market's valuation of Lowe's earnings, revenue, and total worth compared to its sales.

Lowe's has an earnings yield of about 4.88%, indicating the return on investment. The company also has a negative debt-to-equity ratio of approximately -2.94, suggesting a higher level of debt compared to its equity. Additionally, Lowe's current ratio is about 1.01, indicating its ability to cover short-term obligations. Investors are eager to see if the upcoming earnings report will signal a turnaround for Lowe's in the challenging market environment.

Stifel lowered its price target on Lowe’s (NYSE:LOW) to $240 from $250 while maintaining a Hold rating, following the company’s fiscal Q1 2025 earnings. Although results modestly outperformed expectations, the firm remains cautious about the outlook for the remainder of the year and beyond.

The firm kept its 2025 EPS forecast at the low end of Lowe’s reiterated guidance, citing uncertainty around the sustainability of top-line momentum. While Q1 saw an improvement in comparable sales as the quarter progressed, Stifel believes the implied pace of Q2 growth does not yet instill confidence in the company’s ability to meet full-year revenue targets—let alone the acceleration needed to support 2026 and 2027 estimates.

Stifel also pointed to mounting pressure from Home Depot’s stronger execution and comments about preserving pricing power under the new tariff environment. This has heightened scrutiny on Lowe’s ability to protect margins, particularly as Home Depot continues to outperform operationally.

The firm expects Lowe’s stock to trade sideways in the near term, with its valuation reflecting a modest discount to retail peers amid lingering questions around the timing and strength of a potential sales inflection.

Lowe's Companies, Inc. (NYSE: LOW) is a major player in the home improvement retail sector, competing closely with Home Depot. As Lowe's prepares to release its quarterly earnings on May 21, 2025, analysts are keenly observing its financial performance.

The expected earnings per share (EPS) is $2.89, with projected revenue of approximately $21 billion. Despite the challenging market conditions, analysts remain optimistic about Lowe's potential. The Zacks Consensus Estimate suggests a revenue of $20.95 billion, indicating a slight 2% decrease from the previous year. The EPS estimate of $2.89 reflects a 5.6% decline from the same quarter last year.

However, Lowe's has a history of exceeding expectations, with an average earnings surprise of 3.9% over the last four quarters. Lowe's financial metrics provide further insights into its market position. The company has a price-to-earnings (P/E) ratio of 18.94, which helps investors understand how much they are paying for each dollar of earnings. Its price-to-sales ratio of 1.57 indicates how the market values its sales.

Additionally, the enterprise value to sales ratio is 2.02, and the enterprise value to operating cash flow ratio is 17.57, offering a comprehensive view of its valuation. The company's financial health is also reflected in its earnings yield of 5.28%, which shows the return on investment for shareholders. However,

Lowe's debt-to-equity ratio is notably negative at -2.79, suggesting a higher reliance on debt financing. Despite this, the current ratio of 1.09 indicates that Lowe's can cover its short-term liabilities with its short-term assets, maintaining liquidity. As Lowe's prepares to release its earnings, the focus will be on its performance in the Do-It-Yourself (DIY) segment, a key area for the company. Analysts have issued "buy" ratings for Lowe's, with 10 out of 15 analysts expressing confidence in its potential. The mean price target suggests a potential upside of approximately 15%, with a target price of $270.

Lowe’s (NYSE:LOW) delivered an unexpected rise in fourth-quarter comparable sales, as its dual focus on retail and professional customers helped it gain market share in the competitive home improvement sector. As a result, the company’s shares rose more than 3% intra-day today.

The company's strategy, aimed at competing more aggressively with larger rival Home Depot, is gaining traction, according to CEO Marvin Ellison. Quarterly comparable sales edged up 0.2%, defying expectations of a 1.82% decline.

Lowe’s also exceeded top and bottom-line estimates, posting net sales of $18.55 billion and adjusted earnings per share of $1.99, both topping analyst projections.

Looking ahead to fiscal year 2025, the company expects total sales between $83.5 billion and $84.5 billion, slightly below the $84.63 billion analyst forecast. Comparable sales are projected to be flat to up 1%, falling short of the 1.4% growth analysts anticipated.

Meanwhile, Lowe’s set its annual diluted earnings per share guidance at $12.15 to $12.40, trailing Wall Street’s $12.50 consensus estimate.

Lowe’s (NYSE:LOW) delivered an unexpected rise in fourth-quarter comparable sales, as its dual focus on retail and professional customers helped it gain market share in the competitive home improvement sector. As a result, the company’s shares rose more than 3% intra-day today.

The company's strategy, aimed at competing more aggressively with larger rival Home Depot, is gaining traction, according to CEO Marvin Ellison. Quarterly comparable sales edged up 0.2%, defying expectations of a 1.82% decline.

Lowe’s also exceeded top and bottom-line estimates, posting net sales of $18.55 billion and adjusted earnings per share of $1.99, both topping analyst projections.

Looking ahead to fiscal year 2025, the company expects total sales between $83.5 billion and $84.5 billion, slightly below the $84.63 billion analyst forecast. Comparable sales are projected to be flat to up 1%, falling short of the 1.4% growth analysts anticipated.

Meanwhile, Lowe’s set its annual diluted earnings per share guidance at $12.15 to $12.40, trailing Wall Street’s $12.50 consensus estimate.

Lowe's Companies, Inc. (NYSE:LOW) is a prominent player in the home improvement retail sector, competing with industry giants like Home Depot. On November 19, 2024, Lowe's reported earnings per share (EPS) of $2.89, surpassing the estimated $2.81. The company also reported revenue of $20.17 billion, exceeding the estimated $19.94 billion, showcasing its ability to outperform market expectations.

Despite the positive earnings report, Lowe's announced an anticipated decline in full-year sales compared to the previous year. This announcement led to a 4.7% drop in its stock price, which was trading at $259.02. The market's reaction highlights the sensitivity of stock prices to future sales projections, even when current earnings exceed expectations.

In the options market, there was a notable increase in activity, with intraday volume running at four times the usual level. Traders focused on the weekly 11/22 270-strike call, with new positions being sold to open. This indicates a bearish sentiment among traders, possibly due to the anticipated decline in full-year sales.

Lowe's has consistently exceeded consensus EPS estimates over the past four quarters. In the previous quarter, it reported earnings of $4.10 per share, surpassing the anticipated $3.96. This consistent performance demonstrates Lowe's ability to manage its operations effectively, even amid challenges in big-ticket discretionary purchases.

Lowe's financial metrics provide insight into its market valuation. With a price-to-earnings (P/E) ratio of approximately 21.76 and a price-to-sales ratio of about 1.78, the market values Lowe's earnings and revenue favorably. The company's current ratio of approximately 1.13 suggests it can cover short-term liabilities with short-term assets, indicating financial stability.