A pair of retailers that announced earnings Monday needed some analyst window dressing to help offset otherwise negative reports.
J.C. Penney (NYSE:JCP) and Lowe’s (NYSE:LOW) each beat Wall Street expectations Monday — with JCP earning third-quarter earnings of 11 cents per share against Zacks Consensus estimation of a 12-cent loss, and Lowe’s recording adjusted EPS of 35 cents, vs. analysts’ expectations of 33 cents. But the beats didn’t tell the whole tale.
J.C. Penney’s 11 cents per share were 42.1% lower than the year-ago quarter’s 19 cents per share, and including one-time items, the retailer actually lost 67 cents per share. JCP fell short of quarterly sales expectations, registering $3.99 billion vs. Zacks’ estimated $4.02 billion, and both its Internet sales and same-store sales dropped from 2010 marks.
Lowe’s — which announced in October that it’s closing 20 stores and cutting 2,000 jobs to streamline operations — reported net income was $225 million, down 45% from the year-ago period. One-time charges cut the company’s pretax earnings by $336 million. The company’s diluted EPS were 18 cents per share, down from 29 cents in 2010. Lowe’s guidance for the fourth quarter wasn’t magical, either, with the company forecasting same-store revenue to be flat to up 1%.
The companies’ stock paths diverted, with LOW shares gaining about 1.7% to finish the day at $23.50, and JCP dropping 2.8% to $32.98.
Also Monday, Warren Buffett told CNBC that his third-quarter spending spree included a mad grab for IBM (NYSE:IBM) shares, with his Berkshire Hathaway (NYSE:BRK.A, BRK.B) increasing its stake in IBM to about 64 million shares, or about 5.5% of the company. However, at least for the day, investors seemed to take absolutely no notice, with IBM shares trading almost flat at $187.35. Still, Buffett’s buys show IBM has plenty going for it — and investors might consider buying into Big Blue, too.
Three Up
- Amylin Pharmaceuticals (NASDAQ:AMLN): Up 4.29% (43 cents) to $10.45.
- Las Vegas Sands (NYSE:LVS): Up 3.3% ($1.53) to $47.90.
- Salesforce.com (NYSE:CRM): Up 2.81% ($3.65) to $133.52.
Three Down
- ING Group (NYSE:ING): Down 4.95% (40 cents) to $7.68.
- Vertex Pharmaceuticals (NASDAQ:VRTX): Down 4.33% ($1.36) to $30.03.
- Tata Motors (NYSE:TTM): Down 4.05% (75 cents) to $17.76.
As of this writing, Kyle Woodley did not own a position in any of the aforementioned stocks. Check out our list of previous IP Market Recaps.
