Will Lowe’s Revenue Grow In Q1 2019?

by Trefis Team
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Lowe’s (NYSE: LOW) is set to announce its Q1 2019 (ended April 2019) results on May 22, 2019, followed by a conference call with analysts. The market expects the company to report revenue close to $17.7 billion for Q1 2019 (ended April 2019), which would be an increase of 2% on a y-o-y basis. The increase is mainly expected as the revenue per square foot metric will continue to rise. Market expectation is for the company to report earnings of $1.34 per share for Q1 2019 (ended April 2019), higher than $1.19 per share in the year-ago period.


Lowe’s reported $71.3 billion in Total Revenues in Fiscal year 2018.  The revenue comes from the sale of home improvement supplies like tools, construction products, and related services.


We have summarized our key expectations from the earnings announcement in our interactive dashboard – What Has Driven Lowe’s Revenues & Expenses Over Recent Quarters, And What Can We Expect For Full-Year 2019? In addition, here is more Consumer Discretionary data.


Key Factors Affecting Earnings:

Revenue to grow:

  • The company has seen revenue fluctuating over the quarters. In-spite of the fluctuations the company has seen a revenue growth in all quarters of FY 2018 vis-à-vis the same quarters of FY 2017. In Q1 2019 we expect marginal growth over Q1 2018.
  • The company’s revenue growth is mainly contributed by the revenue per square foot metric. It has increased from $305 in 2016 to $340 in 2018. Trefis estimates the metric will reach $349 by 2019.
  • The number of stores and square footage per store metrics have remained nearly flat for a few years now and are expected to continue in the same manner in 2019.

Trend in Expenses:

  • Cost of Sales has been steady at around 67% of Total Revenue over the quarters except Q4 2017 and Q4 2018 where it crossed 70%. We expect for Q1 2019 it will be around 67%.
  • Lowe’s saw a fall in EBITDA margin as SG&A expenses increased by $3 billion in FY 2018.
  • Further, Indirect expenses decreased in FY 2018 as income tax provisions came down by nearly $1 billion. In FY 2019 we expect EBITDA margin to recover and indirect expenses to remain flat.

Full Year Outlook:

  • For the full year, we expect gross revenue to increase by 2.1% to $72.8 billion in FY 2019.
  • EBITDA margin is expected to increase to around 9.5%.


Trefis has a price estimate of $113 per share for Lowe’s stock. The value is based on the expectations of revenue growth as the revenue per square foot metric continues its rise and an improvement in EBITDA margin.



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