Lowe’s stock drops after 2022, forecasts disappoint
Home improvement retailer actions
were down on Wednesday after the company shared its financial outlook for 2022.
) expects total sales for next year to be between $ 94 billion and $ 97 billion, with comparable sales down 3% or down next year. Earnings per share are expected to be between $ 12.25 and $ 13.00.
The company also said it expects gross margin rates to be stable from the previous year and an operating margin of 12.5% ââto 12.8%.
“We are confident in the long term growth prospects of the home improvement market and are making the right investments to continue winning with our professional and DIY customers,” said Marvin R. Ellison, president of Board, President and CEO of Lowe, in a report.
Investors also pulled out after Lowe’s failed to raise its 2021 guidelines, maintaining a prospect of $ 95 billion in sales by year-end. The company bolstered its sales forecast for the year when it released its results in November. The figure was higher than analysts expected at the time and above its own forecast of around $ 92 billion.
Lowe’s board of directors also authorized a new $ 13 billion common share repurchase program, which is in addition to the company’s previous repurchase balance of $ 7.3 billion for a total of approximately $ 20 billion.
The stock fell 3.4% to $ 243.99 on Wednesday in pre-trade, on the verge of erasing a month of gains after declining steadily in the past few days.
Home improvement stocks have been on shaky ground in recent months as the economy reopens, prompting analysts to wonder how far they can move into a post-pandemic era. Last week, Oppenheimer analyst Brian Nagel raised his price target for Lowe’s to $ 300 from $ 235. It evaluates the action to outperform.
Write to Sabrina Escobar at [email protected]