LOW Lowes Companies Inc

By Austen Hufford 

Lowe's Cos. posted revenue and profit growth in the latest quarter as an increase in same-store sales helped drive results.

Comparable-store-sales growth and adjusted earnings per share came in above company expectations. Lowe's also expects rising home prices to encourage more spending on home projects along with job gains and rising consumer sentiment.

Shares of the company rose 8.9% to $81.00 in premarket trading.

During the quarter, sales at stores open at least a year grew 4.2%, above the 2.4% forecast by analysts polled by FactSet. Comparable sales in the U.S. increased 5.1%.

The sales performance fell short of rival Home Depot Inc., which reported last week a 5.8% increase at existing stores for the quarter.

Lowe's said the number of customer transactions rose 15% as the average each customer spent per sale rose 3.6%. The company reported positive comparable sales in 12 of its 13 product categories.

Lowe's quarterly profit was helped by double-digit revenue gains, offset by smaller increase in expenses. The previous quarter was also hit by write-downs and charges.

In all for the quarter, Lowe's said earnings rose to $663 million, or 74 cents a share, up from $11 million, or 1 cent a share. When the write-downs and other charges were excluded, the company posted an adjusted profit per share of 86 cents, up from 59 cents previously.

Revenue rose 19% to $15.78 billion.

Analysts polled by Thomson Reuters expected earnings per share of 79 cents on revenue of $15.39 billion.

For 2017, Lowe's said it expects to add 35 stores, grow comparable-store sales by 3.5% and post earnings per share of $4.64. Analysts had expected $4.53.

As of Feb. 3, Lowe's operated 2,129 stores, up 15% from last year, largely from the purchase of Canadian home-improvement chain Rona Inc.

Write to Austen Hufford at austen.hufford@wsj.com

(END) Dow Jones Newswires

March 01, 2017 09:39 ET (14:39 GMT)

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