Market Overview

Retail Earnings Expectations: Costco And Lowe's

Retail Earnings Expectations: Costco And Lowe's
  • Reports from two big-box retailers will be among earnings highlights this week.
  • Both of them are considered to be less affected by big e-commerce.
  • Wall Street analysts expect good showings from each of them.

The parade of big retailers sharing their latest quarterly results continues. While so far those earnings reports have tended to confirm the ongoing woes in the sector, there have been some bright spots. Among the highlights this week will be results from two big-box store operators that many see as more immune to the so-called Amazon effect. That is, Costco Wholesale Corporation (NASDAQ: COST) and Lowe's Companies, Inc. (NYSE: LOW).

The Wall Street consensus forecasts call for the both companies to show solid growth on the top and bottom lines, relative to the same periods of last year. During their most recent quarters, Costco announced a special dividend, while Lowe's was trading at all-time highs and was seen by Barron's as a better bet than rival Home Depot.


When this membership warehouse operator shares its fiscal third-quarter results after the closing bell on Thursday, the analysts on average predict that it will post $1.31 per share in earnings. That compares to the $1.17 per share reported in the prior quarter and $1.24 a year ago. And the $28.52 billion in expected revenue would be up more than 6 percent year over year. Note that earnings per share fell short of consensus estimates by 15 percent in the previous quarter.

The forecast from 52 Estimize respondents sees EPS at the $1.31. Excluding quarters during the holiday shopping season, that estimate would be the highest quarterly profit in two years. And the consensus revenue estimate for the most recent period is $28.65 billion, down from $29.76 billion in the prior quarter.

See also: Benzinga's Bulls & Bears For The Past Week: Retail And Technology


Wall Street's consensus forecast calls for EPS at this North Carolina-based retailer to have risen from $0.87 in the same period of last year to $1.06. The 42 Estimize respondents have a consensus estimate of $1.08 for the three months that ended in April. Note that EPS fell short of both Estimize and Wall Street expectations in two of the previous three periods.

Estimize underestimated revenue in the previous quarter, and this time the respondents are looking for $17.03 billion. That would be up from the $15.23 billion reported in the year-ago quarter, and it also compares with the Wall Street forecast of $16.96 billion. Look for Lowe's to share its fiscal first-quarter results early Wednesday.

And Others

Other retailers predicted to offer up year-over-year earnings growth when they report this week include AutoZone, Burlington Stores, Chico's FAS and Tiffany. Per-share earnings at Dollar Tree will be the same as a year ago, if the analysts are correct.

But consensus forecasts call for shrinking profits from Advance Auto Parts, Best Buy, Container Store Group, DSW, GameStop and Williams-Sonoma. And a net loss is anticipated from Abercrombie & Fitch and from Kirkland's.

The following week, the parade of big retailer earnings is all but over, but keep an eye out for reports from the likes of Dollar General, Express, Five Below, Lululemon Athletica, Michael Kors and Zumiez.

Latest Ratings for COST

Oct 2019DowngradesBuyNeutral
Oct 2019MaintainsOutperform
Oct 2019MaintainsOutperform

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