Lowe's Gets Hammered

Posted by: Chris Palmeri on May 19

lowes.jpg
Big home improvement chain Lowe’s posted weak numbers today, a 19% decline in earnings, same store sales were down 8%. The stock dropped 2%. It was already 30% off its peak from last year. A couple of interesting points were made about the housing market.

The company says it monitors sales in what they consider overpriced and not-overpriced housing markets and the sales slow down is now spreading from the already hard hit states (Florida, California, Arizona, Nevada) to the other places that didn’t have huge home price run ups such as the Midwest. In fact the few markets still doing well include oil-rich Texas and Oklahoma.

The company said the difference in sales declines between the overpriced home markets and not-overpriced was declining. Meaning everybody’s doing worse. The company has been tailoring its product mix more toward home improvement projects that require relatively little work. They have a new carpet promotion, for example. Major fix up projects like cabinetry are down.

Reader Comments

etq2000

May 19, 2008 10:22 PM

Look at this as another buying opportunity. Load up on a good stock at a firesale price.

Sally in Chicago

May 22, 2008 10:11 AM

Everything that goes up must come down...how much longer did anyone think the housing boom would last before it popped?

Post a comment

 

About

BusinessWeek editors Peter Coy, Dean Foust, Chris Palmeri and Prashant Gopal chronicle the highs and lows of the housing and mortgage markets on their Hot Property blog. In print and online, the Hot Property team first wrote about the potential downside of lenders pushing riskier, "option ARM" mortgages and the rise in mortgage fraud back in 2005—well ahead of many other media outlets. Hot Property was a finalist for "Best Media-Affiliated Business Blog" in the 2007 EPpy Awards, presented by Editor & Publisher and Mediaweek, and was named among the 25 most influential real estate blogs of 2007 by Inman News.

RSS Feed: Hot Property

BW Mall - Sponsored Links