LOW - Higher For Longer Rates Means Lowe's Might Be Lower For Longer
2024-05-30 17:11:28 ET
Summary
- LOW beat analysts' expectations for fiscal 1Q24 for both revenue and earnings, but the stock declined.
- LOW has reported five consecutive quarters of negative same store sales growth.
- America's Home Improvement warehouse is struggling because higher inflation and interest rates have eroded consumers' buying power and delayed major purchases and home sales.
Although Lowe's (LOW) again beat Zacks’ consensus estimates for revenue and earnings and affirmed its guidance for fiscal year 2024 (F2024), investors’ reaction contrasts sharply with past quarters when the stock jumped after the earnings announcement and rallied for the next couple of days. Instead, LOW declined 2% on the day of the announcement and another 4% the rest of the week. The stock opened higher, but investors reversed course after discussion between management and analysts during the earnings call laid bare two key points that have caused me to lower my rating to Hold from Strong Buy....
Higher For Longer Rates Means Lowe's Might Be Lower For Longer