Lowe's Stock Tries to Rebound After Earnings

Lowe's posted Q4 earnings that beat analysts' expectations, but same-store sales and revenue that missed the mark

Lowe's Companies, Inc. (NYSE:LOW) took its turn in the earnings confessional this morning, and the results are a mixed bag. The home improvement retailer posted fourth-quarter adjusted earnings of 94 cents per share, which beat analysts' estimates, but announced $16 billion in revenue that fell short of expectations. The firm's same-store sales, which rose 2.5%, and its 2020 sales growth forecast also largely missed the mark. Despite this, Lowe's is higher, brushing off the bad news with a 0.4% pop to trade at $119.

This attempt to climb higher comes just one day after the equity plummeted to a one-month low of $118.52, thanks in part to direct competitor Home Depot's (HD) successful quarterly report. While the dip had LOW breaching its year-to-date breakeven level, familiar support at its 80-day moving average managed to capture some of these losses.

Analysts have yet to chime in, bull most in coverage are optimistic on the stock. In fact, 18 analysts covering LOW call it a "buy" or better, compared to just three who say "hold," with not a single sell on the books. Plus, the consensus 12-month target price of $135.15 is a 14% premium to last night's close.

Meanwhile, LOW's Schaeffer's put/call open interest ratio (SOIR) of 0.43 sits in just the ninth percentile of its annual range. This suggests short-term option players have rarely been more call heavy in the past 12 months. Echoing this, it appears that in the past 10 days 7,619 calls have exchanged hands, compared to just 3,725 puts.