Lowe's Q4 Win: Higher Profits, Big Buybacks And A Cautious 2025 Outlook

Lowe’s Companies, Inc. LOW stock is trading higher in the premarket session on Wednesday after the company reported better-than-expected fourth-quarter earnings.

The company reported adjusted earnings per share of $1.93 above the street view of $1.84.

Quarterly sales were $18.553 billion, a slight decline of 0.3% year over year, but they outpaced the analyst consensus estimate of $18.292 billion.

Comparable sales for the quarter increased 0.2%, driven by Pro, online growth, holiday sales and hurricane recovery, offset by weak DIY discretionary spending.

Related: Lowe’s Earnings Are Imminent; These Most Accurate Analysts Revise Forecasts Ahead Of Earnings Call

The quarter’s gross margin expanded slightly by 50 bps year over year to 32.9%. Quarterly operating income totaled $1.83 billion compared with $1.687 billion a year ago, with a margin up 80 bps to 9.9%.

As of Jan. 31, 2025, Lowe’s operated 1,748 stores, representing 195.0 million square feet of retail selling space.

The company prioritized capital allocation, repurchasing 5.5 million shares for $1.4 billion and paying $650 million in dividends this quarter, totaling $6.5 billion returned to shareholders for fiscal 2024.

“We remain confident in the long-term strength of the home improvement industry, and we are equally confident in our strategy to capitalize on the expected recovery. We are also pleased to award $80 million in discretionary bonuses to our frontline associates in recognition of their hard work and dedication to delivering excellent customer service,” said Marvin R. Ellison, Lowe’s chairman, president and CEO.

The company’s net cash provided by operating activities for 2024 totaled $9.625 billion, up from $8.140 billion a year ago.

2025 Outlook: Lowe’s forecasts 2025 EPS of $12.15–$12.40, below the $12.51 consensus estimate. Total sales are projected at $83.5 billion – $84.5 billion, compared to the $84.56 billion consensus.

The company expects an operating margin of 12.3%–12.4% and plans approximately $2.5 billion in capital expenditures.

Price Action: LOW shares are trading higher by 3.64% to $251.21 premarket at last check Wednesday.

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