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Lowe's struggles against Home Depot

May 22, 2013: 1:14 PM ET

Click the chart to track shares of Lowe's.

As the housing market heats up, so is competition among home improvement retailers.

A day after Home Depot (HD) delivered earnings and revenue that were much better than forecasts and raised its guidance, Lowe's (LOW) reported a weaker-than-expected quarterly profit for the first-quarter on declining sales.

Lowe's CEO Robert Niblock blamed "cooler than normal temperatures and greater precipitation" for the soft sales figures. In contrast, Home Depot CEO Frank Blake said his company continued to "benefit from a recovering housing market" despite the fact that there was "less favorable weather" during the quarter.

The contrasting results gave traders on StockTwits plenty to chat about.

 LDrogen
$HD really took $LOW to school this quarter, completely divergent reports.

 silverjet2
$LOW needs to improve its shopping experience rather than blame the weather for its missed earnings report

That's a good point. It's not the first time Lowe's has underperformed Home Depot, so bad weather isn't the primary problem. Same-store sales, which measure sales at stores open at least a year and are a key gauge of health among retailers, have been weaker at Lowe's than they have been at Home Depot each quarter for the past several years.

 retail_guru
Lowe's is just plain lucky direct peer is Depot. $HD stellar performance keeps dragging $LOW stock up with it, despite some seriously bad Qs.

A lucky break indeed? Despite the lackluster performance, shares were of Lowe's rose 1% Wednesday, just behind Home Depot's 3% increase. Year-to-date, Home Depot shares of climbed almost 30%, while Lowe's shares are up a healthy 20%.

Related: The market doesn't lie. Housing recovery is real

In addition to the two home improvement retailers, Toll Brothers (TOL) was also in focus Wednesday after announcing strong results, thanks to accelerating demand for houses and higher home prices.

Shares of the luxury homebuilder jumped 7% Wednesday.

 timeday
$TOL rocking housing helping banks rip higher big hedge funds own the BANKS will rip higher $SPY

lamonicabuzz
Toll House Rally. Builder $TOL reports profits and revenue that beat forecasts. More good news for housing. $TOL up 4% pre-market.

  • The market doesn't lie: Housing recovery is real

    The opinions expressed in this commentary are solely those of Paul R. La Monica. Other than Time Warner, the parent of CNNMoney, Abbott Laboratories and AbbVie, La Monica does not own positions in any individual stocks.

    If the housing market is really on the mend, that is undeniably a good sign for the broader economy and the stock market.

    Guess what? It's increasingly looking like the housing rebound is, to pull a MORE

    - May 21, 2013 1:06 PM ET
  • Home Depot cashes in on housing recovery

    Home Depot's stock rallied Tuesday, after the home improvement retailer reported strong results, boosted its dividend and announced plans to buy back shares.

    Shares of Home Depot (HD) gained 5.6% in afternoon trading.

    The nation's leading do-it-yourself home improvement retailer said sales rose 14% in the fourth quarter to $18.2 billion. That helped Home Depot report net earnings of $1 billion, or 68 cents per share, for the quarter.

    On top of that, MORE

    - Feb 26, 2013 2:25 PM ET
  • Lowe's earnings, stock keep improving

    Lowe's (LOW) impressed investors with third quarter results Monday that showed the home improvement retailer is following its own slogan to "never stop improving."

    Third quarter profits jumped 76% from a year ago. Investors, in turn, pushed the stock up nearly 7% Monday. That had some traders on StockTwits excited.

    elliottrexler: $LOW. Is an increase in same store sales oversees an indication of what's to come? #Lowes Beats estimates

    Still it's unclear MORE

    - Nov 19, 2012 12:35 PM ET
  • It could be a red hot holiday season for retail

    Ahead of Black Friday and the holiday shopping season, some retailers are looking rosy.

    Michael Kors (KORS), Dicks Sporting Goods (DKS), TJ Maxx (TJX), Saks (SKS) all reported their latest quarterly results Tuesday. Shares of each moved higher. Home Depot (HD), which isn't as much of a Black Friday beneficiary, also posted strong results and cited the ongoing housing recovery. Shares of Home Depot and Dicks Sporting Goods each jumped MORE

    - Nov 13, 2012 2:25 PM ET
  • Let's sell something together? Lowe's dips on earnings

    Is the housing market really recovering? If you look at the latest results from Lowe's (LOW), you'd be tempted to answer no. But Lowe's top rival, Home Depot (HD) reported a pretty strong quarter and issued good guidance last week. Shares of Lowe's fell more than 4% in early trading Monday.

    It seems that housing is slowly but surely rebounding. The problem with Lowe's seems to be that Home Depot is MORE

    - Aug 20, 2012 10:11 AM ET
  • Paul Ryan owns today's top Dow and S&P 500 stocks

    The Paul Ryan stock portfolio continues to shine. Two stocks that the Republican vice presidential candidate owns - Home Depot (HD) and Estee Lauder (EL) -- spiked Tuesday after both companies reported better-than-expected quarterly results.

    As of mid-morning Home Depot was up 3%, making it the best performer in the Dow. And Estee Lauder's shares shot nearly 8% higher, making them the top gainer in the S&P 500.

    Ryan seems to have MORE

    - Aug 14, 2012 10:37 AM ET
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