Lowe's Companies, Inc. (NYSE:LOW) Flying High

And Another Win For Members of Stock Options Made Easy
“Earnings Predictions”

Profit Up 290% and More Expected!

by Ian Harvey

May 24, 2018




Lowe's Companies, Inc. (NYSE:LOW)

Here is an update of LOWs winning options call trade after reporting earnings. This options trade was recommended as a consideration to members of Stock Options Made Easy “Earnings Predictions” on May 21, 2018; which produced excellent potential profits of 290% -- within a couple of days of executing the trade!



The Trade.......


“Earnings Predictions for the Week Beginning May 21, 2018”

The Details……..

Lowe's Companies, Inc. (NYSE:LOW), a home improvement retailer, is scheduled to announce its earnings before the market opens. The consensus earnings estimate is $1.22 per share on revenue of $17.58 billion; however, the earnings whisper number is for $1.28 per share. Consensus estimates are for year-over-year earnings growth of 18.45% with revenue increasing by 4.27%.

After registering an earnings decline of 14% in the final quarter of fiscal 2017, Lowe's Companies is expected to record year-over-year growth of more than 18% in the first quarter of fiscal 2018.

An improving job scenario, housing market recovery and merchandising initiatives along with efforts to enhance omni-channel capabilities bode well for Lowe's. Moreover, the company's focus on strengthening its relationship with Pro customers is encouraging.

The buyout of Maintenance Supply Headquarters is enhancing the company's relationship with Pro customers. Further, Lowe's has refurbished its pro-service business website, LowesForPros.com, in order to cater to the needs of its Pro customers. The company's Canadian and Mexican businesses has been doing pretty well. Meanwhile, the buyout of RONA has been fortifying the company's position in the Canadian market.

Lowe's Canada entered into a strategic partnership with Solar Brokers Canada to provide solar energy installation services to homeowners under Lowe's Solar banner. Of late, the company has been focusing on maintenance, repair and operations products, evident from its acquisition of Maintenance Supply Headquarters and also the earlier buyout of Central Wholesalers.

In fact, the reflection of these endeavors is quite evident from a 4.1% rise in fourth-quarter comparable sales (comps), following an increase of 5.7%, 4.5% and 1.9% recorded in the third, second and first quarter, respectively.

There seems to be optimism about Lowe's performance in the soon-to-be-reported quarter.……..continue reading.

The Trade……..

Option trade to consider: Buy the LOW JUNE 15 2018 87.500 CALL at approximately $2.00.

The Result………

Shares of Lowe's Companies jumped on Wednesday despite a first-quarter report that missed analyst expectations across the board. News that Lowe's had poached J.C. Penney CEO Marvin Ellison for the top job at the company could be contributing to the gains. Another factor could be news that Bill Ackman's Pershing Square had acquired a $1 billion stake in the retailer.

Lowe's gapped sharply higher Wednesday morning. Stock price at Tuesday’s close was $85.75, but opened Wednesday at 90.70; hitting a high of $95.14 (over 10%), and finally closing at $94.69.

Lowe's reported first-quarter revenue of $17.4 billion; up 3% year over year but about $290 million below the average analyst estimate. Comparable sales increased by just 0.5%, impacted by weak sales in outdoor categories caused by unfavorable weather. The company said that sales in May have been strong.

Earnings per share came (EPS) in at $1.19, up from $0.70 in the prior-year period but $0.08 lower than analysts were expecting. EPS rose 15.5% from the adjusted EPS Lowe's reported during the first quarter of 2017.

Future Outlook……

For the full year, Lowe's expects sales to rise by about 5%, driven by a 3.5% increase in comparable sales. The company expects earnings per share between $5.40 and $5.50.

While Lowe's missed analyst estimates, the company's success luring Marvin Ellison away from J.C. Penney may be giving investors hope that Lowe's can accelerate its growth.

The Profit……..

So, for members of Stock Options Made Easy “Earnings Predictions”, who managed to execute this trade; a nice tidy profit already of more than 290% made within 48 hours. 

Entering the option trade at a cost of $2.00 or less; and reaching as high as $7.80; one options contract would provide a profit of $580.00.



Now is the time to decide if it is worth continuing to hold this trade or exit on excellent profits. It is nearly always prudent to exit a trade before an unknown incident occurs that could rattle a sound profit, and this is a fine example of such a situation.

Our approach is to predict whether a company will beat or miss estimates, whether the stock will appreciate or depreciate as a result and what strategies investors and traders can use. This type of prediction is based on thorough investigation and fundamentally based research, and the results have been very exceptional.

Our proven track record says it all!!

There are usually five (5) trades recommended for consideration each week; providing great profits – look at the chart in the article “Earnings Predictions” for this week.

If you not a member ……… SIGN IN HERE

What To Do Now…….

If you interested in being part of this profitable action just click here……

Best of Trading,
Ian Harvey
Director of Stock Options Made Easy


”Success is simple. Do what's right, the right way, at the right time.”

Option Tip for your Success!
Options traders are not successful because they win.
Options traders win because they are successful.

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