Lowe's Companies Inc

Lowe's Companies reported second-quarter adjusted earnings of $4.40 per share, beating the $4.22 FactSet consensus, but cut its full-year sales forecast to $92 billion and now expects comparable sales to be approximately flat. Total sales rose 8.3% to $25.96 billion, helped by acquisitions, while organic comparable sales increased just 0.2%, below the 0.8% expected. The company cited persistent pressure on discretionary DIY spending and softer housing trends affecting its Foundation Building Materials and Artisan Design Group units. Full-year adjusted diluted EPS is now forecast at approximately $12.25, the bottom of the previous range. Shares closed 2.0% higher at $220 on August 19.

Lowe's Companies saw its fair value estimate trimmed from roughly US$263.73 per share to about US$258.19 per share as analysts reset Q2 expectations. Several firms including Telsey Advisory, Citi, UBS, Mizuho and Bernstein continue to rate the stock Outperform or Buy even after revising price targets lower, while BofA moved to a Neutral rating citing softer July trends and heavier competitor promotions. The revised model assumes revenue growth of about 4.23%, a net profit margin of about 8.05%, a future P/E multiple of about 23.22x, and a discount rate of about 8.97%. Truist noted five consecutive quarters of positive comparable sales with about 70% of categories positive, while Bernstein and Mizuho flagged comparable sales softness and weaker Q3 commentary tied to Lowe's heavier exposure to discretionary DIY and seasonal categories compared with Home Depot.

The U.S. Treasury announced plans to double liquidity support buyback operations on longer-end securities, sending bond yields notably lower and lifting market indexes ahead of the open. The current buyback position of $2 billion per operation will now become $4 billion, with the 30-year bond dropping below 5.3%, the 10-year beneath 4.7%, and the 2-year under 4.2%. Moderna shares surged 95% after its intismeran vaccine met primary goals in Phase 3 testing for preventing cancer in melanoma patients, while partner Merck rose 7%. Target reported beats on both top and bottom lines with earnings of $2.46 per share on revenues of $26.54 billion, but shares fell 1% despite raised guidance. Lowe's posted mixed results with earnings of $4.40 per share beating estimates while revenues of $25.96 billion missed, and TJX Companies outperformed with earnings of $1.22 per share but fell 3.3% on a weaker outlook. Estee Lauder shares jumped 12% after fiscal Q4 earnings of $0.39 per share beat the $0.32 anticipated on revenues of $3.63 billion.

Moderna shares jumped 95% in pre-market trading after its intismeran vaccine met primary goals in Phase 3 testing for preventing cancer in melanoma patients whose tumors had been surgically removed, while partner Merck rose 7%. The U.S. Treasury said it will double liquidity support buyback operations on longer-end securities from $2 billion to $4 billion per operation, sending bond yields lower and market indexes higher. Target reported beats on both top and bottom lines with earnings of $2.46 per share on revenues of $26.54 billion, but shares fell 1% despite raised guidance. Lowe's posted mixed results with earnings of $4.40 per share beating estimates by 4.27% while revenues of $25.96 billion missed consensus by 0.68%. TJX Companies beat estimates with earnings of $1.22 per share on revenues of $15.18 billion but shares dropped 3.3% on a weaker outlook, and Estee Lauder surged 12% after fiscal fourth-quarter earnings of $0.39 per share on revenues of $3.63 billion beat expectations.

Moderna and Merck shares surged after their personalized cancer vaccine showed positive results in a late-stage trial, with Moderna skyrocketing 120% and Merck jumping 10%. Pilgrim's Pride rallied 15% after JBS, which owns more than 80% of the chicken producer, bid to acquire the remaining stock. Gold miners jumped after the Treasury Department announced sharply higher government debt repurchases, sending yields lower and boosting gold, with the VanEck Gold Miners ETF up 9% and Coeur and Hecla each gaining more than 13%. Marvell Technology rose more than 7% after giving Google permission to buy a $12 billion stake as part of a custom chip development deal. Coinbase surged 11% as bitcoin popped more than 5% to about $68,000, while Lowe's gained over 3% despite cutting its full-year outlook to the bottom end of prior guidance. Target added 5% after beating second-quarter revenue expectations and hiking full-year guidance, helped by a $752 million tariff refund boost. La-Z-Boy tanked 16% after fiscal first-quarter adjusted earnings fell 9% and current-quarter revenue guidance missed FactSet consensus, while Mercury Systems slid more than 6% on mixed results. Estee Lauder rose more than 16% after fiscal fourth-quarter adjusted earnings and revenue beat estimates.

Moderna shares jumped as much as 50% in premarket trading after the drugmaker and Merck said their experimental melanoma drug combination outperformed Keytruda alone in a Phase 3 trial. The INTerpath-001 study tested intismeran autogene, an investigational individualized mRNA-based neoantigen therapy, in combination with Merck's Keytruda in patients with completely resected stage IIB-IV melanoma, meeting its primary endpoint of recurrence-free survival and a key secondary endpoint measuring distant metastasis-free survival. Target stock fell 4.0% despite the retailer raising its annual sales forecast, with investors focusing on the impact of tariffs and the company's underlying profit outlook; comparable sales for the quarter ended Aug. 1 rose 3.8%, beating expectations for 2.5% growth, and tariff refunds provided a nearly $1 billion boost during the quarter. Honeywell Aerospace shares rose 2.8% after Morgan Stanley upgraded the newly independent aerospace company to Overweight from Equalweight and set a $205 price target, while Lowe's shares fell 2.6% after the home improvement retailer reported second-quarter results that beat expectations on earnings but missed badly on revenue. Estée Lauder rose 6.3% in premarket trading ahead of its fiscal fourth-quarter and full-year results, and Rising Dragon Acquisition Corp. surged 223.3% to $18.91 in premarket trading with no clear catalyst identified.

Goldman Sachs economists warn that US consumer spending growth is set to slow sharply in the second half of the year as the temporary boost from higher-than-planned tax refunds fades. Economist Jan Hatzius wrote in a note that second quarter sales at consumer companies rose 5.9% year over year among the median S&P 500 consumer discretionary company and 3.9% for the median consumer staples company, powered by the tax refund surge. Hatzius expects real consumer spending growth to slow to 1-1.5% in the second half as real cash flow stagnates, despite consumer spending accelerating to a 3.2% annualized pace in the second quarter from 0.5% in the first quarter. The thesis will be tested this week with earnings and outlooks from Home Depot, Lowe's, Walmart, and Target, with Walmart most in focus given its third quarter outlook.

The US goods trade deficit narrowed to $101.5 billion in June 2026, down from $105.9 billion in May, as imports fell but domestic factories have not yet filled the gap. Nucor reported a 92% surge in net income and a 72% stock gain over one year, with finished steel import market share dropping from 23% to 16% under Section 232 enforcement. Consumer sentiment collapsed from 61.7 to 44.8 over the same period, while Lowe's shares fell 11% and gross margin compressed 70 basis points. Union Pacific's intermodal revenue jumped 26%, but Old Dominion Freight Line saw a 7.7% decline in tons per day, signaling that lower imports have not yet translated into more domestic freight. Walmart and Lowe's are absorbing higher costs, with Walmart's inventory up 8.9% and Lowe's comparable sales up just 0.6%.

Growth in last-mile delivery for big and bulky e-commerce items has slowed by half as stagnant home sales curb demand for large-ticket discretionary items like furniture and appliances, according to a report from Armstrong & Associates and the National Home Delivery Association. The $10.6 billion market for residential delivery of oversized and heavyweight items is now projected to grow at a 5.1% compound annual rate through 2027, down from 10.6% over the prior eight years, reaching an estimated $12.3 billion. Housing turnover hit a 30-year low last year, with only 28 of every 1,000 homes changing hands, a 38% drop from the 2021 pace, while the Trump administration's tariffs on aluminum and steel imports have further raised appliance costs and dampened demand. Gross margins in the segment have dipped from 28.9% in 2022 to 27.5% last year, and carriers face rising costs from diesel fuel, cargo insurance, and labor shortages. Top national providers include RXO Last Mile with $1.2 billion in gross revenue, Ryder E-commerce and Last Mile Services with $983 million, and J.B. Hunt Final Mile Services with $824 million, while a looming competitive threat is vertical integration by large retailers such as Wayfair, Lowe's, and Amazon.

Home Depot reported quarterly revenue of $41.8 billion for the period ended May 2026, while Lowe's reported $23.1 billion for the same period, highlighting Home Depot's continued dominance in the home improvement retail industry. Over the past eight quarters, Home Depot's revenue ranged from $38.2 billion to $45.3 billion, consistently outpacing Lowe's, which ranged from $18.6 billion to $24.0 billion. Home Depot benefits from a professional contractor customer base that contributes about half its sales. Both companies faced share price declines amid interest rate headwinds and a soft housing market, with Home Depot hitting a 52-week low of $289.10 in May and Lowe's falling to $203.40 in June. Home Depot's price-to-sales ratio briefly dipped below two for the first time in a year, while Lowe's remains at a compelling 1.3 times sales and recently raised its dividend 4% to $1.25 per share.

Home Depot's push into HVAC and professional contractor services is drawing investor attention as a potential catalyst that could reshape its competitive standing against Lowe's. The company recently rolled out AI-powered tools for Pro Xtra members, including Material List Builder and an expanded Pro digital workspace, aiming to simplify complex job planning and support higher-value projects. Analysts project Home Depot could reach $187.2 billion in revenue and $17.3 billion in earnings by 2029, implying 4.0% annual revenue growth and a $3.3 billion earnings increase from the current $14.0 billion. However, concerns persist over operating margin pressure and elevated capital spending, with community fair value estimates clustering between $351 and $370, suggesting limited upside from the current price.

Nordson shares jumped 25.5% year to date through June 30, 2026, more than doubling the S&P 500's 9.5% return, after being named one of the three best Dividend Aristocrats to buy in 2026. The company raised its quarterly dividend to $0.82 from $0.78 and reported record fiscal second-quarter adjusted earnings of $2.86 per share on revenue of $740.85 million, with 7% organic growth across all segments and an 18% increase in backlog. Management lifted full-year guidance to sales of $2.93 billion to $3.01 billion and adjusted EPS of $11.30 to $11.80. Aflac, another pick, gained 6.3% and raised its quarterly payout 5.2% to $0.61, while Lowe's fell 8.6% despite beating earnings estimates for six straight quarters and increasing its dividend to $1.25 per share. All three companies extended their dividend growth streaks, underscoring the income-compounding thesis even as Lowe's faced housing-market headwinds.

A recent analysis flags Lowe's, Monro, and Warby Parker as consumer stocks with warning signs. Lowe's has seen sales decline 2.6% annually over three years and weak same-store sales, with a gross margin of 33.3%. Monro faces ongoing store closures and a 31.9% annual drop in earnings per share over three years. Warby Parker reports operating margin losses and negative returns on capital despite $890.6 million in revenue.

Lowe's Companies carries a Zacks Rank #3, or Hold, as analysts have trimmed near-term earnings estimates. The consensus estimate for the current quarter stands at $4.26 per share, down 0.7% over the past 30 days, while the current fiscal year estimate of $12.48 has slipped 0.1% and the next fiscal year estimate of $13.47 has declined 0.2%. The home improvement retailer is expected to report quarterly revenue of $26.25 billion, a 9.5% year-over-year increase, and it beat consensus EPS estimates in each of the last four quarters. Zacks grades Lowe's a C for value, indicating it is trading in line with peers.

Home Depot holds a stronger investment position than Lowe's, according to a Zacks Investment Research analysis, driven by its larger scale, robust professional customer ecosystem, and expanding addressable market. Home Depot's first-quarter fiscal 2026 sales rose 4.8% year over year to $41.8 billion, while Lowe's sales increased 10.3% to $23.1 billion, though Lowe's saw broader downward EPS revisions. Home Depot trades at a forward P/E of 21.1X, above Lowe's 16.66X, but both stocks sit below their five-year medians. The report notes Home Depot's better estimate revision trends and recent stock performance, with Lowe's shares down 8.6% over three months versus Home Depot's 1.3% decline, reflecting greater investor confidence in Home Depot's execution and earnings visibility.