Posted on 08/20/2024 12:41:16 PM PDT by CFW
Lowe's cut its annual profit and sales forecasts on Tuesday, echoing bigger rival Home Depot's concerns of a slim chance of a recovery in home improvement demand this year.
The U.S. Federal Reserve was expected to cut interest rates earlier this year, but insufficient proof of easing inflation thus far has kept the rates high, which is affecting home sales, and consequently demand for expensive renovation projects.
"We're seeing significant implications ... people aren't moving nearly as often as they typically do because current mortgage rates are so much higher," said CEO Marvin Ellison on a post-earnings call.
Lowe's expects a 3.5% to 4% drop in comparable sales for the full year and adjusted earnings per share of about $11.70 to $11.90, down from about $12.00 to $12.30 it previously forecast.
Last week, Home Depot also forecast a decline in annual profit and a bigger drop in annual comparable sales.
Unusually warm weather also dented sales for the home improvement companies during the typically strong spring season, as consumers put off expensive lawn and garden projects.
Tepid demand for do-it-yourself (DIY) projects, which account for more than half of Lowe's sales, led to a 5.1% drop in second-quarter comparable sales — wider than analysts' expectation of a 4.11% fall, per LSEG data.
(Excerpt) Read more at finance.yahoo.com ...
Meanwhile, every indicator from businesses, from lower sales and expectations, to lay-offs and business closings, tells us otherwise. I don't think weather has anything to do with it. "Weather "comes each year so is baked into companies expectations as to consumer spending. Consumers are no longer buying those new appliances or expanding the patio, closing in the garage, or adding that new outdoor kitchen. With inflation and the ever increasing costs of the essentials, we can no longer afford any discretionary spending.
The consumer is tapped out. Savings are gone and credit cards are maxed out.
As a nation, we cannot afford four more year of progressive policies.
The Biden/Harris economy strikes again.
Can’t buy groceries or fuel, but we can re-do the bathroom, NOT...
Their credit card has a ~33% APR. Just makes you not want to support the company in any way.
Yeah but people keeping up their homes or fixing them up should help increase sales since it’s so expensive to buy another.
Like keeping an old car and repairing it rather than buying new.
But I guess nails and caulk and insulation doesn’t cover losing appliance sales.
I just make the old cars with good bodies new. Engine, transmission, brakes and the elactricals. No spy tech involved. They go for a premium as well. Not everyone is stupid.
Lowes is just another Chinese store front. Less sales means less imports. Not a bad thing really.
“Yeah but people keeping up their homes or fixing them up should help increase sales since it’s so expensive to buy another.”
There is little evidence homeowners are doing that. Instead, they are letting things go rather than improving, repairing, or updating home areas. That is why Lowe’s has lowered their outlook. Since Home Depot has done the same, it doesn’t look good for housing repairs and improvements over the next few months, at least.
From Home Depot just last week:
“Home Depot expects demand to stay tight through the rest of the year, as homeowners wait for lower interest rates before pursuing big projects. The home-improvement retailer cut its outlook for comparable-store sales, saying it now expects a 3% to 4% decline, instead of just a 1% drop.”
In hard times homeowners can make minor temporary fixes instead of major renovations.
Opposite of cars. Weird. I’d think a home owner would want to maintain the place.
Maybe it’s because new stuff isn’t being built as much.
We’re I live you could stack boxcars and rent them for 1500 a month.
What’s the latest model year you deal with? I’ve got a 98 Firebird I’m putting a few bucks into.
The only thing I have bought from Lowes since the spring is 200ft of 2 foot high chicken wire to keep the damn rabbit pests out of my veggies. Grown eats are much cheaper than the prices I see in the produce section of local supermarkets.
Maybe lower their prices on appliances especially and people will flock the store. But no that’s definitely what they won’t do. Dummy’s!
YES. I had to replace my dryer today. 10 years ago I bought a low end dryer for $300. The low end dryer I got today was $700. If I didn’t need the stupid thing I would not have bought it.
I’m going to tell a quick Lowe’s story. I am registered with their veteran program. At the beginning of the summer I was thinking about getting a new lawn mower. About the same time Lowe’s sent me an email that I was qualified for a special gift for being a veteran. I figured a screwdriver or pair of gloves or something. One day I was on their website looking at lawnmowers and added one to my cart just to see the total price. There was another item in my cart; the free gift. Not gloves or screwdrivers, a $300 seed spreader. I had just had my whole front yard dug up for a new septic system and guess what I needed? I immediately checked out. So, I got 10% (about $350) off the lawnmower, a free seed spreader, free assembly, and free delivery. I am a Lowe’s fan.
Absolutely crazy. There is no reason for an appliance to be that price. Worse it lasts half the time they used too.
The first washer/dryer set I bought, I got at a scratch and dent sale in 1985. They lasted until 2014. Now I have machines that barely last 10 years.
It’s disgusting. It’s so frustrating especially since nothing is being done about it.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.