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Closing Bell: Sudden euphoria, take 18 (C, DNDN, LOW, ORCL, SII)

Today started out strong with a weaker dollar ahead of tomorrow's FOMC meeting. We have a slew of data coming out the rest of the week and tomorrow's commentary on securities purchases and liquidity programs should likely beat out the notion that rates are still staying at near-zero percent.

Here are today's unofficial closing bell levels:

Dow 9,829.27 +50.41 (0.52%)
S&P 500 1,071.63 +6.97 (0.65%)
Nasdaq 2,146.30 +8.26 (0.39%)

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Continue reading Closing Bell: Sudden euphoria, take 18 (C, DNDN, LOW, ORCL, SII)

Lowe's issues a cautious earnings outlook

On Tuesday morning, Lowe's (NYSE: LOW) issued a cautious earnings outlook for the coming year. On a more positive not, the home-improvement giant actually expects same-store sales to increase, bringing an end to several years of same store sales declines.

LOW's announcement was accompanied by a reiteration of its expectations for the fiscal year. It expects to open 66 stores this fiscal year, and as many as 45 in the next fiscal year (which starts on January 30). For the coming year, LOW believes it will earn $1.24 to $1.34 per share with revenue growth of 3% to 4% and a same-store sales rise of roughly 1%. The current estimates from the Street call for earnings of $1.34 per share and a 3% revenue increase.

Continue reading Lowe's issues a cautious earnings outlook

Lowe's Q2 earnings preview

Lowe's earnings previewHome improvement retailer Lowe's Companies (NYSE: LOW) will be reporting its second quarter earnings before the market opens on Monday, and there are some positive indicators that it may have been a good quarter for the company.

Over the past year, weak consumer confidence has put a strain on Lowe's, as home owners who have worried about job security and a weak housing market have put off home repair projects. As a result, Lowe's stock fell as low as $13.00 back in March, but has rebounded nicely over the past few months to its current trading price of $22.71.

Continue reading Lowe's Q2 earnings preview

Hurricane plays: Winners and losers

"I have four Hurricane Season stock picks -- two bullish, two bearish -- to play this summer's potentially wild weather," says Sean Broderick in his Uncommon Wisdom advisory.

"Last year's stormy weather spawned 16 named storms, which was higher than the long-term average of about 10 tropical storms and six hurricanes per year in a typical Atlantic hurricane season.

"The major hurricane forecasters have now made their predictions, and it's for a 'moderate' hurricane season. That's good news for America's oil and gas industry.

Continue reading Hurricane plays: Winners and losers

Time to scoop up some shares of The Home Depot

What? Buy The Home Depot (NYSE: HD) after it reported Q1 EPS of 35 cents -- it beat the First Call Q1 EPS estimate of 29 cents – but failed to raise guidance? Indeed, the Buy rating has been generated. Here's why:

Home Depot's Q1 sales fell 9.7% and same store sales declined 10.2%. Those are pretty bad totals for key metrics, and of course the stock sold off some Tuesday, with short-term players taking profits. However, unless you believe the U.S. housing market and economy is likely to remain in recession for more than two quarters, those low sales totals sat up easier comparisons for next year, and the stock pull-back represents a buying opportunity.

Continue reading Time to scoop up some shares of The Home Depot

Lowe's rises after Q1 beat, but don't buy high

So, the story doesn't start off so well. Lowe's (NYSE: LOW) issued its Q1 numbers earlier today, and right off the bat, beginning at the top line, you see that net sales declined over 1%. Then you notice that profit on a dollar basis plunged over 20%. Earnings per share? That also took a dive of over 20%.

Then you look at the stock. And you say to yourself, "what's going on?" As I write this, with less than three hours to go in the trading day, shares of Lowe's are trading almost 10% higher! On excellent volume, too. As you might have thought, an earnings beat was lurking somewhere in the plot of this particular tale. Lowe's earned $0.32 per share in Q1. According to Trey Thoelcke's earnings preview, the market thought that only $0.25 could be achieved. This differential is helping to fuel the buying.

Continue reading Lowe's rises after Q1 beat, but don't buy high

Williams-Sonoma beats expectations; its stock is strong but expensive

Home-products retailer Williams-Sonoma (NYSE: WSM), which runs such retail brands as Pottery Barn and West Elm in addition to its namesake chain, issued Q4 numbers on Tuesday. Well, they weren't spectacular. Surprised? No, I'm sure you weren't. I mean, when you sell stuff for homes, you've got to expect that you're going to see some weakness. And there's plenty of it here.

Revenues decreased almost 27% during the quarter, and earnings per share on an adjusted basis dropped over 70% to 31 cents. That beat estimates of 16 cents per share, according to Reuters' analysts, but forgive me if I don't jump up and down over that performance. And what about same-store sales? They were mighty bad. On an overall basis, they went down by over 22%.

Continue reading Williams-Sonoma beats expectations; its stock is strong but expensive

The Lowe down

Home improvement retailer Lowe's (NYSE: LOW) said Friday its fourth-quarter profit fell 60% from a year ago, as consumers continued to shy away from big-ticket items, such as appliances and cabinetry.

Lowe's said it earned $162 million, or 11 cents per share, in the quarter ended Jan. 30 -- down from earnings of $408 million, or 28 cents per share, last year. Revenue fell 4% to $9.98 billion as same-store sales, a key measure of performance since it tracks growth at existing stores rather than newly opened ones, dropped 9.9%.

Continue reading The Lowe down

Masco (MAS) misses estimates and announces dividend cut

Masco fourth quarter 2008 earningsMasco Corp. (NYSE: MAS), which manufactures and installs building materials, announced its fourth quarter numbers Wednesday afternoon, falling short of analyst estimates.

Analysts had expected to see the company show a loss for its fourth quarter of 5 cents, but a tough sales environment pushed the company's loss much wider than expected, with a reported 18-cent loss per share.

Continue reading Masco (MAS) misses estimates and announces dividend cut

Obama Stock Picks: Lowe's (LOW) and The Home Depot (HD)

President Obama is speaking as I type this post. He is making many promises, and I believe he will make every effort to see them through to the best of his ability.

Regardless of his successes and failures in the coming years, we now have the focus of Washington and Wall Street working on preventing us from slipping into a depression and guiding us out of a year-old recession. Main Street is also doing its share to correct past mistakes, and they are making the biggest sacrifices.

These sacrifices come in the form of lower wages, cutting back on spending, living on fewer resources than they may have had available to them only a short while ago. We go on this journey together and many conjecture that things will get worse before they get better. I think this is only partially true. Unemployment appears to be rising but most of our problems seems to be known to us even if not resolved.

Continue reading Obama Stock Picks: Lowe's (LOW) and The Home Depot (HD)

Lowe's beats earnings in Q3, but I'm not buying

Well, seems like Lowe's Companies, Ic. (NYSE: LOW) did much better than expected during the third quarter. And I was apparently too pessimistic in my earnings preview. The call was for $0.28 per share. The home-improvement retailer beat expectations by $0.05 per share, according to Thomson Reuters estimates. Hey, I tip my hat to management.

But I wouldn't buy the stock just now (unless, of course, you have a very long-term horizon, are willing to ride out the bear market, and intend on improving your cost basis through dollar-cost-averaging). My reasoning is simple: total sales increased only 1.4%, and same-store sales decreased nearly 6%. It's that bad drop in the comps that really has me worried. All retailers are suffering through lousy comps right now, and I think sales are destined to remain weak.

Yet, the market seems to be saying something else to me. Lowe's saw its shares rise over 4% on Monday, on good volume, and on a bad day for the major indexes, too. Is the market saying that all the bad news is priced in? You know, I understand the earnings game and how the market loves it when a business beats estimates, and certainly a $0.05 beat is cool, but I'm not sure that better prices are ahead for those who follow Lowe's and its stock. Consumers just won't be spending enough to justify the buying seen in Lowe's equity yesterday.

Continue reading Lowe's beats earnings in Q3, but I'm not buying

Earnings preview: Will Lowe's go lower after it reports?

Lowe's (NYSE: LOW), a chain that sells products related to home improvement for do-it-yourselfers and competes with Home Depot (NYSE: HD), is set to report earnings for the third quarter on Monday, November 17. The expectation is for $0.28 per share. If management hits that number, which its shareholders are praying it does at the very least, then that would represent a 35% drop in per-share income. At this point, investors are becoming numb to things like 35% drops in per-share income, aren't they? Ah, the wonders of a bear market.

Lowe's beat in the previous two quarters according to AOL Finance, but all bets are currently off as far as I'm concerned. Retail is awful, consumer confidence just felt the poke of the Grim Reaper's index finger and is dying a slow death, and I'd have to assume that people haven't done much to improve their homes during the past quarter. With all the headlines talking about job losses and the like, putting up new cabinets in the kitchen is probably far down on the consumer's list of priorities. The actual numbers for the quarter won't matter so much. Even if Lowe's beats by a penny, it's the outlook Wall Street will be dissecting. And that won't be good, will it? Everyone's outlook is cautious at the very best. At the very least, management will be doing what it can in terms of preserving the margins. I'm sure there will be talk about cost-cutting and efficiencies during the conference call. Let me tell you, management is going to need a lot of efficiency initiatives going forward in this cataclysmic climate. And I hope they have their cash-flow statement working at an optimum level.

Continue reading Earnings preview: Will Lowe's go lower after it reports?

Lowe's, Home Depot expected to post Q2 profit declines

Earlier this week, Jim Cramer pondered whether the U.S. economy had reached bottom, given such recent signs as stronger-than-expected retail sales and investor interest in homebuilders. In particular, he said he's looking at next week's quarterly results from Lowe's (NYSE: LOW) and Home Depot (NYSE: HD) as a sign for the housing sector and for the potential market rally.

Lowe's is expected by analysts surveyed by Thomson Financial to report second-quarter earnings of 39 cents per share, down 18.8% from 48 cents per share in the same period in 2007, but up 28.2% from 28 cents per share in the previous quarter. The company has provided positive surprises in four of the past five quarters.

North Carolina-based Lowe's is the second-largest U.S. home improvement chain, behind rival Home Depot, and the second-largest appliance retailer after Sears (NYSE: SHLD). In the past year, the company's revenues were $48.2 billion and its net income totaled $2.8 billion. Its long-term EPS growth forecast is 12.7%, which is better than its industry average. The consensus recommendation of analysts remains to buy Lowe's.

The stock is up 9.9% since the beginning of the year, but has fallen 20.5% from a year ago. It trades at a P/E ratio of 13.38. Shares closed Friday at $24.89.

Continue reading Lowe's, Home Depot expected to post Q2 profit declines

Black & Decker knows that housing won't be in a slump forever

Readers of this space know that the investment bias is toward large-cap companies with demonstrated business models and who have a competitive advantage in established markets, preferably with a favorable global trend as a support. And with the above in mind, Black & Decker is worth a review.

The Black & Decker Corporation (NYSE: BDK) is a global manufacturer and marketer of power tools and accessories, hardware, home improvement products, and fastening systems.

In general, analysts like BDK's recent restructuring to improve productivity and operating margins. For the most part, analysts are forecasting low-single-digit sales growth for 2008 and 2009, weighed down by the housing sector's doldrums.

Continue reading Black & Decker knows that housing won't be in a slump forever

Earnings previews: Lowe's and Home Depot

America's largest home improvement superstores, Lowe's Companies Inc. (NYSE: LOW) and Home Depot Inc. (NYSE: HD) are scheduled to report earnings this coming week. Here's a quick peek at them ahead of results.

Lowe's has missed earnings expectations only once in the past five quarters. When the company reported third-quarter fiscal 2008 results back in November, earnings came to 43 cents per share, beating the consensus forecast of analysts polled by Thomson Financial by two cents. For the current quarter, analysts expect only 25 cents per share, compared to 40 cents in the year-ago quarter.

The company's earnings per share growth forecast for the next three to five years is 19.1%, less than the industry average of 31.6%. The analysts' consensus recommendation is to buy Lowe's, though 10 of 21 analysts rate it a hold. Shares are up from the 52-week low of $19.94 in January, and closed Friday at $23.59.

For news on Lowe's and its rivals that could influence the earnings results, see BloggingStocks' Lowe's coverage.

Continue reading Earnings previews: Lowe's and Home Depot

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S&P 500+23.781,093.08

Last updated: November 09, 2009: 11:55 PM

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