Lowe's 2Q revenue tops Street as consumers pick up appliances, other goods
MOORESVILLE, N.C. (AP) -- Lowe's second-quarter revenue beat analyst estimates as customer stocked up on things like appliances and outdoor power equipment.
It was same story a day earlier from rival Home Depot Inc., which also saw appliance sales rise as well as strong demand for water heaters, windows and riding mowers.
Low mortgage rates, rising home values and a healthy job market have all benefited home improvement retailers and there are indications that the real estate market is going to keep getting better.
The Commerce Department this week said that construction of single-family homes shot up 12.8 percent in July to the highest rate since December 2007. That was right before the market imploded.
Sales of new and existing homes have climbed in the first half of 2015. Purchases of new homes are 21.2 percent higher through the first six months of this year than the same period in 2014. Existing homes are selling at an annual rate of 5.49 million, the fastest pace since February 2007, according to the National Association of Realtors.
But Lowe's and Home Depot have stood apart from others in the retail sector, marking a shift in how Americans spend money.
Department stores, also reporting earnings this month, have largely been routed. Economic data shows that people are spending more money on travel, cars and homes, than on fashion.
Those trends appeared in sales figures put out by Lowe's on Wednesday.
For the three months ended July, 31 Lowe's revenue rose to $17.35 billion from $16.6 billion.
This topped the $17.31 billion in revenue expected on Wall Street, according to a survey by Zacks Investment Research expected.
Sales at stores open at least a year climbed 4.3 percent, and 4.6 percent in the U.S.
Same-store sales are a key indicator of a retailer's health because it excludes volatility typical of stores recently opened or closed.
The Mooresville, North Carolina, company earned $1.13 billion, or $1.20 per share, for the quarter. A year earlier it earned $1.04 billion, or $1.04 per share.
Per-share earnings were 3 cents shy of analyst projections, according to Zacks.
Lowe's Cos. maintained its 2015 forecast for earnings of about $3.29 per share and a sales increase of 4.5 percent to 5 percent. Analysts polled by FactSet predict full-year earnings of $3.28 per share.
The company's stock shed 60 cents to $72.42 in Wednesday premarket trading.
Elements of this story were generated by Automated Insights (http://automatedinsights.com/ap ) using data from Zacks Investment Research. Access a Zacks stock report on LOW at http://www.zacks.com/ap/LOW
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