Lowe’s (NYSE:LOW) shares jumped Wednesday after the company reported better-than-expected earnings.
For the first quarter ended May 1, Lowe’s reported that net income rose 27.6% to $1.34 billion, or $1.76 per share, compared to earnings of $1.05 billion, or $1.31 per share, a year ago. Excluding items, the company earned $1.77 per share, outpacing analyst expectations of $1.32 per share.
Revenue rose 10.9% to $19.68 billion, up from $17.74 billion a year ago.
The company also announced it is withdrawing its full-year 2020 guidance due to uncertainty related to the coronavirus pandemic.
The coronavirus hit as the home improvement retailer has been attempting to revive its business under CEO Marvin Ellison, who assumed the role in 2018. Lowe’s has been trying to build out its e-commerce platform and attract more professional homebuilders and contractors as opposed to do-it-yourself customers.
The company said it saw a pop in online traffic as capacity was limited at brick-and-mortars and the company rolled out curbside pickup to accommodate online customers and local virus restrictions.
"I am also pleased with our ability to pivot to serve increased online demand with Lowes.com sales increasing 80% in the quarter," Ellison said in a statement. He added that sales have so far remained high through May.
Experts said that the "strong" results support Lowe’s stock gains Wednesday. Lowe’s shares have underperformed Home Depot’s stock by 1,150 basis points year to date, and trade at a lower multiple to earnings.
Lowe’s shares opened Wednesday up a solid $3.18, or 2.7%, to $119.99.
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