Lowe's Lowdown? Analyst Sees Weaker Sales Than Consensus, Cites Weather Woes

Core Viewpoint - JPMorgan analyst Christopher Horvers has lowered estimates for Lowe's Companies Inc. ahead of its first-quarter earnings release, indicating a more challenging environment than previously anticipated [1][4]. Group 1: First Quarter Estimates - First-quarter comparable sales estimates for Lowe's have been cut to -2.7%, which is below the Street's consensus of -1.7% and broader buyside expectations of a decline between 2% to 3.5% [1][2]. - Lowe's had previously guided for a -2% comparable sales for the first quarter and expected flat comps for the first half, anticipating a ~$400 million shift of spring sales into the second quarter [2][3]. Group 2: Weather Impact - The company faced significant headwinds from unfavorable DIY weather conditions earlier in the quarter, leading to underperformance compared to Home Depot, even as weather conditions improved later [2][3]. - The second quarter is expected to have easier weather comparisons, but estimates have been slightly lowered to +2% from +3% due to first-quarter underperformance and uncertain weather outlook [3]. Group 3: Earnings and Guidance - The estimated first-quarter EPS for Lowe's is $2.87, compared to the Street's estimate of $2.91 [3]. - Given the expectation of missing the first-quarter outlook, Lowe's is anticipated to adjust its full-year guidance towards the lower end of flat comparable sales and around a 12.3% operating margin [4]. - The company is expected to reiterate confidence in managing tariffs and safeguarding margins despite a less favorable scenario [4].