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Oct 30, 2020
Lowe's Q3 2020 Earnings Report
U.S. comparable sales increased 30.4% and adjusted diluted EPS of $1.98 was reported.
Key Takeaways
Lowe's reported strong Q3 2020 results with a significant increase in sales and earnings, driven by broad-based demand and investments in omni-channel capabilities. The company saw a 30.1% increase in comparable sales and an adjusted diluted EPS of $1.98. Lowe's also invested heavily in COVID-related support for associates and store safety.
U.S. comparable sales increased by 30.4%.
Diluted EPS was $0.91, including a $1.05 negative impact from debt extinguishment.
Adjusted diluted EPS increased to $1.98.
Lowes.com sales increased by 106%.
Forward Guidance
Lowe's provided its financial outlook for the fourth quarter of 2020, anticipating continued sales growth and strategic investments.
Positive Outlook
- Total and comparable sales growth of approximately 15 to 20 percent.
- Expected repurchase of approximately $3.0 billion of stock.
- Diluted earnings per share and adjusted diluted earnings per share of $1.10 - $1.20.
- The Company expects to complete the reset of over 90% of its U.S. stores by the end of the fiscal year.
- Capital expenditures of approximately $1.7 billion are expected for fiscal 2020.
Challenges Ahead
- Adjusted operating margin is expected to be essentially flat to prior-year levels.
- Ongoing COVID-related operating expenses will impact profitability.
- $150 million expense related to the reset of the layout of U.S. stores.
- Investments in expanding the supply chain network.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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