Upcoming AWS Coverage on Tile Shop Holdings Post-Earnings Results

LONDON, UK / ACCESSWIRE / March 16, 2017 / Active Wall St. announces its post-earnings coverage on Lowe's Cos. Inc. (NYSE: LOW). The Company released its fourth quarter fiscal 2016 (Q4 FY16) and full year fiscal 2016 (FY16) on March 01, 2017. The Mooresville, North Carolina-based Company's quarterly net sales and adjusted diluted EPS surged 19.2% and 45.8% y-o-y, beating market consensus estimates. Register with us now for your free membership at:

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One of Lowe's Cos.' competitors within the Home Improvement Stores space, Tile Shop Holdings, Inc. (NASDAQ: TTS), reported on February 14, 2017, results for its fourth quarter and fiscal year ended December 31, 2016. AWS will be initiating a research report on Tile Shop in the coming days.

Today, AWS is promoting its earnings coverage on LOW; touching on TTS. Get our free coverage by signing up to:

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Earnings Reviewed

In Q4 FY16, Lowe's reported net sales of $15.78 billion compared to $13.24 billion in Q4 FY15. Net sales numbers for the reported quarter topped market expectations of $15.28 billion.

The home improvement retailer reported net earnings of $663 million, or $0.74 per diluted share, in Q4 FY16 compared to $11 million, or $0.01 per diluted share, in the prior year's comparable quarter. Adjusted net earnings surged during Q4 FY16 to $0.86 per diluted share from $0.59 per diluted share in the previous year's same quarter. Moreover, Wall Street's adjusted earnings expectations for the reported quarter were $0.79 per diluted share.

For full-year FY16, Lowe's net sales stood at $65.02 billion, rising 10.1% from $59.07 billion in the previous year. The Company reported net earnings of $3.09 billion, or $3.47 per diluted share, in FY16 versus $2.55 billion, or $2.73 per diluted share, in FY15. Additionally, the Company's adjusted diluted earnings FY16 were $3.99 per diluted share, up 21.3% from $3.29 per diluted share in FY15.

As on February 03, 2017, Lowe's operated 2,129 home improvement and hardware stores in the United States, Canada, and Mexico, which comprised of 213.4 million square feet of retail selling space.

Operating Metrics

During the three months ended February 03, 2017, the Company comparable sales growth was recorded at 5.1%, primarily driven by a 4% increase in comparable average ticket and 1.1% increase in comparable transactions.

In the reported quarter, Lowe's reported gross margin of $5.43 billion, or 34.41% of net sales, compared to $4.59 billion, or 34.66% of net sales in the prior year quarter. Selling, general, and administrative for Q4 FY16 came in at $3.79 billion, or 23.99% of net sales, versus $3.78 billion, or 28.54% of net sales, in the previous year quarter. Lowe's Q4 FY16 operating income surged to $1.27 billion, or 8.05% of net sales, from $439 million, or 3.31% of net sales, in Q4 FY15. Furthermore, pre-tax earnings were 7.04% of net sales in Q4 FY16, up 481 basis points from the prior year's comparable quarter.

Cash Flow and Balance Sheet

In the year ended February 03, 2017, net cash provided by operating activities was $5.62 billion compared to $4.78 billion in FY15. Additionally, the Company's capital expenditures during FY16 were $1.17 billion, resulting in a free cash flow of over $4.4 billion, up 24% y-o-y.

As on February 03, 2017, the Company had $558 million in cash and cash equivalents compared to a balance of $405 million as on January 29, 2016. The Company reported long-term debt of $14.39 billion in its books of accounts as on February 03, 2017, rising from $11.55 billion as on January 29, 2016.

Share Repurchases

During Q4 FY16, Lowe's repurchased stock worth $551 million, under its share repurchase program and paid dividends amounting to $306 million. Furthermore, the Company repurchased shares worth $3.5 billion and paid $1.1 billion in form of dividends during the financial year ended February 03, 2017.

Earnings Outlook

In its guidance for full year FY17, Lowe's expect total sales to increase by approximately 5% y-o-y. The Company anticipates comparable sales to grow by 3.5% during FY16. Furthermore, the Company projects diluted earnings to be approximately $4.64 for the fiscal year ending February 02, 2018.

Stock Performance

At the closing bell, on Wednesday, March 15, 2017, Lowe's stock rose 1.62%, ending the trading session at $83.27. A total volume of 4.79 million shares were traded at the end of the day. In the last month and previous three months, shares of the Company have rallied 12.68% and 12.30%, respectively. Moreover, the stock surged 17.66% since the start of the year. The stock is trading at a PE ratio of 30.57 and has a dividend yield of 1.68%.

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SOURCE: Active Wall Street