Lowe's maintains FY2026 EPS guidance

Lowe's kept its full-year profit outlook unchanged when it reported first-quarter results on May 20, even as analysts cut price targets a day later and pointed to near-term margin pressure. The home-improvement retailer said diluted earnings per share for fiscal 2026 are still expected to be $12.25 to $12.75. First-quarter sales rose 10.3% to $23.08 billion, while net earnings fell slightly to $1.623 billion from $1.636 billion a year earlier, according to the company's earnings release and financial statements. The company said the quarter included $96 million in pre-tax expenses tied to its acquisitions of Foundation Building Materials and Artisan Design Group. Analysts at RBC Capital and BofA responded on May 21 by lowering targets or highlighting cost pressure after the report. ### What exactly did Lowe's keep unchanged? Lowe's said in its May 20 earnings release that it reaffirmed fiscal 2026 diluted EPS guidance of $12.25 to $12.75. The company also left its broader annual framework intact, including sales of $92 billion to $93 billion and comparable sales expected to range from down 1% to up 1%. The company reported diluted EPS of $2.90 for the quarter ended May 1, 2026, compared with $2.92 in the first quarter of 2025. Adjusted EPS was $3.03, ahead of analysts' expectations compiled by LSEG, CNBC reported. ### How strong was the quarter on sales? First-quarter sales were $23.08 billion, up from $20.93 billion a year earlier, Lowe's said. Comparable sales increased 1.7%, and the company said gains were driven by high-single-digit Pro and online comparable sales growth, rebuilding demand tied to recent hurricanes, and strength in spring events. The May 1 quarter was the first to include contributions from Foundation Building Materials, which Lowe's acquired in 2025. Lowe's said U.S. retail square feet increased 12.1% from a year earlier, reflecting the addition of acquired operations. ### Why did profit slip even with higher revenue? Net earnings were $1.623 billion in the quarter, down from $1.636 billion a year earlier, according to Lowe's financial statements. The company said it recorded $96 million in pre-tax acquisition-related expenses associated with FBM and ADG during the quarter. Marvin Ellison, Lowe's chairman, president and chief executive, said in the earnings release that the company was "pleased" with performance in the quarter and cited Pro momentum, online growth and hurricane-related demand. The release did not change the full-year earnings range despite the lower year-over-year quarterly profit. ### What did analysts flag after the report? RBC Capital analyst Steven Shemesh maintained a Sector Perform rating on May 21 and cut his price target to $232 from $264, according to a ratings summary published that day. A separate market report said RBC viewed Lowe's unchanged 2026 outlook as supportive, but cited cost pressure and risks to future earnings assumptions. BofA Securities also cut its price target after the results, according to a Benzinga report published May 21. That report said analyst Robert Ohmes pointed to second-quarter earnings guidance that implied a year-over-year decline, citing higher transportation costs and investment in sales-driving initiatives as sources of operating-margin pressure. ### Where are the pressure points management and analysts are watching? Higher transportation costs were one of the clearest issues raised in post-earnings analyst commentary on May 21. BofA said those costs, along with investments intended to support sales, could weigh on second-quarter margins. At the same time, Lowe's said the quarter showed continued growth in the Pro business and online sales. The company tied first-quarter demand partly to rebuilding activity after recent hurricanes, a factor that lifted seasonal and project-related categories. ### What comes next for investors following the story? Lowe's has posted its first-quarter 2026 press release, financial statements and earnings materials on its investor relations site. The company's quarterly earnings page and events-and-presentations page also host the May 20 earnings call materials for investors tracking whether second-quarter margin trends match the concerns raised by RBC and BofA.