Lowe's reports lower earnings.
Lowe's Cos. reported a 12% fall in first-quarter profit Monday as the housing slump and tough comparisons sawed into the home-improvement retailer's bottom line.
Multiple factors, including a difficult housing market in many areas, tough comparisons to hurricane rebuilding efforts and significant lumber and plywood-price deflation continued to create a challenging sales environment in the first quarter," said Robert Niblock, Lowe's chief executive, in the earnings report. "Those anticipated factors were compounded by mixed weather during the quarter."
The central issue here is housing. The other points are pure noise and deflection. Home Depot had the same market and the same set of problems.
Target sales drop
Target's same-store sales fell 6.1% in April. The average estimate of analysts polled by Thomson Financial called for a decrease of 6.2% for the month. Net retail sales fell 1.8% in the period to $3.9 billion from $3.97 billion a year earlier.
The Minneapolis-based general-merchandise retailer cited a sales shortfall in the first two weeks of April for the lackluster results. It forecast May same-store-sales growth in a range of 5% to 7%. In the May period a year earlier, Target's same-store sales increased 5.7%.
Target has been successful at taking customers away from Wal-Mart. However, Target's performance this month is not that impressive and falls in line with Wal-Mart's results.
JC Penney surprises on the upside.
The moderate-priced department-store chain has been on a tear in recent months, introducing new private-label and designer lines found only at Penney stores. It has brought out Ambrielle lingerie, the largest private-brand launch in its history, as well as Liz & Co. and Concepts by Claiborne. It is on track to launch the American Living collection of apparel and home goods by Polo Ralph Lauren and is stepping up its rollout of Sephora cosmetics counters on its sales floors.
All that helped boost Penney's (profit to $238 million, or $1.04 a share, compared with last year's income of $210 million or 89 cents a share.
JC Penney has completely turned themselves around and are doing a great overall job. Now -- can they keep it up in the current environment? We'll have to see.