Shares of Lowe’s Companies (NYSE:LOW) surged in morning trading, as the company reported better-than-expected financial results for the third quarter.
The second largest U.S. home improvement retailer announced that net income came in at $396 million (35 cents per share) for the quarter ended November 2, 2012. This represents a 76 percent jump from the same period last year, when the company earned $225 million (18 cents per share). Excluding some items like write-downs and a charge for discontinued projects, earnings per share equaled 40 cents, a nickel above analysts’ estimates.
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Sales at Lowe’s received a boost, as the company’s quarter ended a few days after superstorm Sandy damaged the northeast. Revenue increased 1.9 percent to $12.1 billion, compared to analysts’ estimates of $11.9 billion. Lowe’s has also been implementing an everyday-low-pricing strategy to better compete with Home Depot (NYSE:HD), which has been outperforming Lowe’s.
For the past 14 consecutive quarters, Lowe’s same-store sales have lagged behind Home Depot, according to Reuters. However, sales at Lowe’s stores open at least one year increased 1.8 percent on a global and domestic basis. It was 2.5 percent below Home Depot’s growth rate, but the gap has typically been between 3.0 percent and 3.5 percent.