Boston, MA, 02/27/2014 – Lowe’s Companies, Inc (NYSE:LOW) rose strongly yesterday after it posted the much awaited fourth quarter numbers and its plans of share buyback. The home retailer’s shares have been on a lift after its rival Home Depot impressed the Wall Street with a robust growth in the fourth quarter and Lowe was also expected to follow the same trend.
While Lowe’s Companies, Inc (NYSE:LOW)’s earnings per share for the fourth quarter came at par with the analyst view of $0.31 per share, it missed to show the same in its revenue numbers, which was at $11.66 billion, lower than the street expectation by $30 million. During the fourth quarter, the company noted that its comparable-store sales rose 3.9%. Its gross margin also improved by 40 basis points to 36.4% in the reported period. Full year earnings rose 16.7%, driven by housing rebound, which led to more home improvements.
Share Buyback And Future Outlook
Apart from this, the home retailer has also set aside allowance for addition sharebuyback of $5 billion, which is almost 10% of the company’s current market capitalization. Lowe’s Companies, Inc (NYSE:LOW) has remaining $1.3 billion in its prevailing buyback program. As for the current fiscal year, Lowe anticipates total sales to grow 5% and earnings per share to be in the range of $2.60, lower than the analyst expectation of $2.64 per year. The same store sales are projected to grow at 4%, following the analyst similar estimate. Lowe intends to extend 15 new home-improvement stores alongwith five hardware stores this year, growing its total number of 1,832 stores.
The more-than-expected share surge in Lowe’s Companies, Inc (NYSE:LOW) come unexpected as the results do not vary largely with the consensus, however, the recent report regarding higher new home sales may have given a push to the country’s second-ranked home improvement and furnishing retailer.