Looks like Lowe’s is facing a tough Third Quarter

According to Forbes, Lowe’s is slated to report its third quarter earnings on November 20, wherein a 3.4% gain in revenues and a 6.7% drop in earnings per share is expected. The home improvement retailer has had a tricky FY 2018, with unseasonably cold weather dampening its first quarter results. The Forbes report mentioned how while it posted a recovery in the second quarter, beating consensus expectations on both revenues and earnings, the company was unable to match the astounding performance posted by its closest competitor, Home Depot , continuing the recent trend of the former playing catch-up to the latter. Lowe’s is faced with significant organizational changes, including a new CEO and CFO, along with certain disruptions and inventory issues which have pressured sales.

In the third quarter, while its sales growth is expected to be led by the digital segment, the earnings decline is primarily a result of its recent decision to shut down 20 underperforming stores in the U.S., and 31 such locations in Canada. Moreover, the exit from its Orchard Supply Hardware business will result in $390 to $475 million in additional costs in the second half of the financial year, pressuring the operating margin.

In the piece, Forbes.com have mentioned Factors that may impact performance