Lowe's Companies, Inc. is a home improvement retailer operating in the United States and Canada. It offers products for construction, maintenance, repair, remodeling, and decorating, including appliances, seasonal and outdoor living, lumber, lawn and garden, kitchens and bath, hardware, building materials, millwork, paint, rough plumbing, tools, electrical, flooring, and décor. The company also provides installation services through independent contractors, extended protection plans, and repair services, as well as design, distribution, and installation services for interior surface finishes to home builders and property managers. It sells national brand-name and private brand products to professional customers, individual homeowners, and renters through Lowes.com, mobile applications, retail home improvement stores, outlet stores, and branches. Founded in 1921, Lowe's Companies, Inc. is based in Mooresville, North Carolina.
Lowe's squeezed by high mortgage rates and cautious homeowners
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Lowe's cuts full-year outlook to low end Lowe's beat second-quarter earnings but lowered its fiscal 2026 guidance to the bottom of its ranges: sales about $92 billion, flat comparable sales, and earnings near $11.75 a share. The cut reflects soft demand, and it tells investors management sees no near-term pickup, weighing on the stock.
This is the period's biggest company-specific news and directly explains why the outlook for LOW worsened.
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Mortgage rates at three-year high of 7.45-7.5% The average 30-year mortgage rate jumped to 7.45-7.5%, the highest in three years, adding thousands in yearly payments for buyers. With less money left over, homeowners delay big remodels, which cuts into Lowe's sales of kitchens, baths and other large projects.
Rising mortgage costs are the main outside force pressuring demand for home improvement, and they explain the stock's September slide.
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Homeowners shift to smaller, cheaper projects Lowe's says customers are choosing small jobs like countertops or cabinets instead of full kitchen or bathroom renovations, and expects the second half to look like the first. Smaller projects mean lower average tickets, so sales grow slowly even as Lowe's gains market share.
This explains the demand pattern behind the weak guidance and why comparable sales are barely positive.
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UBS: Lowe's defensive strengths against AI shopping agents UBS named Lowe's one of six hardlines retailers best placed as AI shopping agents reshape retail, citing its installation services, technical expertise and project guidance. That differentiation is harder for AI agents to replace, suggesting Lowe's profit pool is more protected than pure product sellers.
This is the one clearly positive new item, offering a counterweight to the demand worries.
Q3 2026
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Lowe's Q2 Sales Beat but Guidance Cut on Weak DIY Demand
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Q2 Sales Beat on Pro and Online Growth Lowe's Q2 sales rose 8.3% to $26 billion, powered by Pro and online growth (up 15.7%). Earnings beat estimates, and $80 million in tariff refunds boosted results. UBS also noted Lowe's defensive strengths against AI shopping agents.
This point explains the positive drivers behind Lowe's Q2 performance, which supported the stock.
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Full-Year Guidance Cut to Low End Lowe's cut full-year guidance to the low end (about $92 billion sales, ~$11.75 EPS) due to cautious DIY demand, a revenue miss, and softer new-home construction. This signaled weaker outlook than previously expected.
This point highlights the negative revision to guidance, a key factor pressuring the stock.
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Mortgage Rates Hit Three-Year High Mortgage rates reached a three-year high of 7.45–7.5%, pressuring big-ticket remodels as homeowners shifted to smaller projects, lowering average tickets. This weighed on demand for larger discretionary items.
This point explains the macro headwind from high mortgage rates that hurt demand for big-ticket items.
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Tariff Refunds Smaller Than Home Depot's Lowe's tariff refunds were far smaller than Home Depot's, and the sector was downgraded despite analyst preference for Lowe's. This relative disadvantage added pressure on the stock.
This point shows a competitive disadvantage and sector downgrade that negatively affected Lowe's.
News & notes movingLOW
United States
Robotics & Physical AI▲
Lowe's Launches Drone Delivery From North Carolina Store
Lowe's Companies has begun drone delivery from its Matthews, North Carolina store, offering selected home improvement and household items in as little as 20 minutes through partners Wing and DoorDash. The pilot launch comes as Lowe's shares have been under pressure, with a 30-day share price return down 8.83%, a year-to-date share price return down 26.13%, and a 1-year total shareholder return down 24.75%. The company is also accelerating its shift toward professional contractors while strengthening its Total Home strategy for DIY and Do It For Me customers, supported by major acquisitions including Foundation Building Materials and Artisan Design Group plus digital investments. The most followed narrative values Lowe's at $255.00 against a last close of $182.38, a 28.5% undervalued estimate based on discounted future cash flows. That story could break if Pro demand softens for longer than expected or if the FBM and ADG integrations drag on profitability.
UBS Flags Six U.S. Hardlines Retailers as AI Shopping Agents Reshape Retail
UBS has identified the leading U.S. hardlines retail stocks as the industry confronts the emergence of AI-powered shopping agents, which the firm calls one of the most consequential developments in retail since the rise of e-commerce. The analysis examines how retailers with scale, fulfillment capabilities, and genuine differentiation may navigate the shift as AI agents increasingly intermediate commerce between consumers and merchants. UBS says the most immediate downside risk to revenue remains low, but the larger risk may emerge in profit pools rather than top-line sales, particularly as AI agents potentially bypass sponsored search results and retail media advertisements. The six names on the list are Walmart, Target, Costco, Home Depot, Lowe's, and Kroger. Walmart is cited for a balanced strategy that embraces partnerships with external AI platforms while investing in its own capabilities, with the challenge centering on protecting high-margin advertising businesses and ecosystem economics rather than preserving sales growth. Costco benefits from scale, pricing power, and a differentiated membership model, while Home Depot and Lowe's retain defensive advantages through installation services, technical expertise, and project guidance, and Kroger operates in grocery, where repetitive shopping is conducive to automation but fresh food selection and immediate consumption needs continue to anchor consumers in physical stores.
COST · Competition · Positive UBS cites Costco's scale, pricing power, and differentiated membership model as advantages as AI shopping agents reshape retail.
HD · Competition · Positive UBS says Home Depot retains defensive advantages via installation services, technical expertise, and project guidance amid the AI-agent shift.
LOW · Competition · Positive UBS says Lowe's retains defensive advantages through installation services, technical expertise, and project guidance as AI agents reshape retail.
WMT · Competition · Neutral UBS cites Walmart's balanced AI-agent strategy but warns of risk to its high-margin advertising and ecosystem economics as AI agents may bypass sponsored search.
KR · Competition · Neutral UBS notes Kroger's grocery niche suits automation but fresh-food and immediate-consumption needs keep consumers in stores, a mixed read.
TGT · Competition · Neutral Target is named on UBS's list of six hardlines retailers facing the AI shopping-agent shift, but no specific advantage or risk is detailed.
Homebuilding Stocks Slide as Mortgage Rates Hit 7.5%
Homebuilding and home improvement stocks are heading for a bruising September as mortgage rates climb back to 7.5%. The S&P 500 Homebuilding Index has fallen 3.2% so far this month, pressured by the rapid run-up in mortgage rates and slumping revenues at Lennar and KB Home. Retailers are faring worse: Home Depot shares have slid 11% this month and Lowe's has dropped 8.5% as building activity slows and renovators shift to smaller, cheaper products. Mortgage rates have surged more than half a point in two weeks, and on Monday the average rate on a 30-year fixed-rate loan touched 7.5% for the first time since April of 2024. After briefly falling below 6% early this year, rates were pushed higher by the war in Iran and accompanying inflation, dampening sales and keeping homebuyers sidelined.
HD · Demand · Negative Home Depot shares slid 11% this month as slowing building activity and renovators shifting to smaller, cheaper products hit demand.
LOW · Demand · Negative Lowe's dropped 8.5% this month as slowing building activity and a shift to smaller, cheaper renovation products weigh on demand.
KBH · Demand · Negative KB Home is cited for slumping revenues amid the mortgage-rate surge that is keeping homebuyers sidelined.
LEN · Demand · Negative Lennar is cited for slumping revenues as mortgage rates climbing to 7.5% dampen home sales.
Lowe's launches drone delivery pilot with DoorDash and Wing
Lowe's is launching a drone delivery service in partnership with DoorDash and Alphabet's Wing, making it the first home improvement retailer to use unmanned aerial vehicles for e-commerce fulfillment. The service is available for select products as a pilot program at Lowe's store in Matthews, North Carolina, the company announced on Thursday. Lowe's said customers can receive a curated list of small products, including hand tools, paint supplies, tape, batteries and soap, in as fast as 20 minutes, with the service suited for items weighing up to 2.5 pounds. Customers access drone delivery through the DoorDash app, where Lowe's products are displayed, and select the drone delivery option during checkout. The move follows Home Depot's recent introduction of nationwide express same-day delivery from stores using DoorDash and its pool of on-demand drivers, as retailers push to meet growing customer expectations and compete with marketplaces like Amazon.
Mortgage Rates Hit 7.45%, Highest in Three Years, Threatening Home Improvement Stocks
The average interest rate on a 30-year mortgage has climbed to 7.45%, its highest level in three years, a surge driven by rising 10-year Treasury yields that could soon weigh on home improvement stocks. At that rate, the monthly payment on a $500,000 mortgage reaches $3,479, up from $2,995 just seven months ago, adding $5,813 a year in mortgage interest expense for home buyers. Yahoo Finance Executive Editor Brian Sozzi flagged the move as a major economic problem that is not getting enough attention, noting it carries implications not only for home builder stocks like Toll Brothers but also for companies such as Home Depot and Lowe's, since buyers facing sharply higher payments will have less money for kitchen remodels or outdoor living spaces. Sozzi credited BlackRock's Rick Rieder, who appeared on Sozzi Unleashed on Thursday, with describing the US housing market as frozen. Sozzi said he plans to say more on housing in the coming weeks, calling it a real drag on the US economy.
HD · Demand · Negative Higher mortgage payments leave buyers with less money for kitchen remodels and outdoor living, weighing on Home Depot's end demand.
LOW · Demand · Negative Sharply higher mortgage costs reduce discretionary spending on home improvement projects, hurting Lowe's end demand.
TOL · Demand · Negative Mortgage rates at a three-year high of 7.45% threaten home builder demand, with Toll Brothers explicitly cited as affected.
Fed Study Finds Only 14.8% of Firms Plan to Cut Prices After Tariff Refunds
A Federal Reserve Bank of Atlanta survey found that most U.S. companies are keeping their tariff refunds rather than passing them to consumers, with only 14.8% intending to lower prices and 17.2% planning consumer rebates. The U.S. Treasury had issued nearly $135 billion in tariff refunds by mid-September, out of $166 billion collected by U.S. Customs and Border Protection from 330,000 importers before the Supreme Court declared President Donald Trump's Liberation Day tariffs illegal. Walmart received a $2.9 billion refund, Apple $2.2 billion, Nike $986 million, Target $994 million, Home Depot $730 million, Amazon $600 million, General Motors $500 million, TJX $331 million, Lowe's $80 million and Motorola $60 million. The survey found 75.2% of companies plan to hold onto their refunds, with 52.5% planning to invest in research and development or capital projects, and the refunds represent an average 1.7% of annual revenues. Walmart has pledged to use its refund to cut prices, while FedEx set up a tariff refund portal for eligible customers and UPS is also offering refunds to customers. Consumers have launched class-action lawsuits against companies including Nike, and Sens. Elizabeth Warren and Bernie Sanders are pressing the Trump administration to include consumer relief and plan refunds if the court strikes down new tariffs, including up to 12.5% tariffs on imports from 86 countries and 50% tariffs on a variety of Canadian products.
Lowe's Q2 Revenue Rises 8.3% to $25.96 Billion as Full-Year EPS Guidance Misses
Lowe's reported second-quarter revenues of $25.96 billion, up 8.3% year on year, in line with analysts' expectations, but its full-year EPS guidance missed estimates. The home improvement retailer, one of 6 home furnishing and improvement retail stocks tracked, posted the fastest revenue growth in the group yet the weakest performance against analyst estimates and the weakest full-year guidance update among its peers. "Sustained growth in Pro, Online and Home Services led to our fifth consecutive quarter of positive comp sales, despite pressure in discretionary DIY spending," said Marvin R. Ellison, Lowe's chairman, president and CEO. Lowe's stock is down 11% since reporting and currently trades at $191.98. Across the group, revenues beat analysts' consensus estimates by 1.6% while next quarter's revenue guidance came in 2.6% below, and share prices have fallen an average of 6.5% since the latest earnings results.
Lowe's Expects Steady Second Half as Homeowners Shift to Smaller Projects
Lowe's Companies expects the second half of the year to resemble the first half, as elevated interest rates and economic uncertainty keep homeowners cautious about big-ticket spending, Chairman, President and Chief Executive Officer Marvin Ellison said at the Goldman Sachs Global Consumer and Retail Conference. Ellison said the company does not expect a material change in the housing backdrop for the rest of the year, but believes it can grow and gain market share regardless of macroeconomic conditions, pointing to five consecutive quarters of positive comparable sales growth and digital sales growth exceeding 15% in each of the past two quarters. More than 60% of Lowe's sales come from do-it-yourself customers, and while its core homeowner customer has an average household income above $100,000 and roughly $400,000 in equity, those consumers are favoring smaller, more deliberate projects such as countertops or cabinets over full kitchen or bathroom renovations. Lowe's estimates the home-improvement market at roughly $1 trillion, with Lowe's and its largest competitor together accounting for about $250 billion of that total, leaving smaller regional players as another opportunity for share gains. The company's acquisitions of ADG and FBM have expanded it into construction-related markets, and about 55% of FBM revenue comes from commercial construction, including data centers, sports venues, hotels and university projects. Looking ahead, Lowe's plans to prioritize debt reduction toward a 2.75-times leverage ratio, which it expects to reach around the midpoint of next year, while continuing dividend payments and potentially revisiting share repurchases after hitting that target.
LOW · Demand · Neutral Lowe's expects a steady second half with cautious homeowners favoring smaller projects, though it cites five straight quarters of positive comparable sales growth and market-share gains.
Foundation Building Materials · Demand · Positive Lowe's acquisition of FBM expanded it into construction-related markets, with about 55% of FBM revenue from commercial construction including data centers and sports venues.
Artisan Design Group · Capital · Positive Lowe's acquisition of ADG expanded the company into construction-related markets.
Home Depot Flags $730 Million Tariff Refund Boost to Gross Margin
Home Depot reported that its second-quarter fiscal 2026 gross margin rose about 25 basis points to 33.7%, helped by $730 million of IEEPA tariff refunds, of which $685 million reduced cost of goods sold and provided roughly 145 basis points of gross-margin benefit. That benefit offset about 60 basis points of higher costs tied to fuel, energy and other product inputs, though management expects those rising costs to fully offset the tariff-refund benefit over the full year and is also facing incremental tariff pressures not contemplated in its original 2026 plan. Home Depot expects a fiscal 2026 gross margin of 33.1% and a fourth-quarter gross margin roughly flat year over year. Among peers, Lowe's second-quarter fiscal 2026 gross margin fell 80 basis points as a roughly 30-basis-point tariff refund benefit was largely offset by elevated fuel and transportation costs, while Floor & Decor's adjusted gross margin slipped 20 basis points to 43.7% and the company guided to 43.6-43.8% for the year. Home Depot shares have lost 26.3% over the past year versus a 32% decline for the industry, and the stock trades at a forward price-to-earnings ratio of 19.87X against an industry average of 17.96X.
Walmart and Home Depot Differ on Tariff Refund Use
Walmart and Home Depot are both receiving significant tariff refunds but are handling them differently, as reported by CNBC. Walmart CFO John David Rainey said the company is eligible for roughly $2.9 billion in refunds, with just under $100 million still outstanding, and that the boost contributed to a 1.6% increase in Walmart U.S. gross profit. Rainey said Walmart plans to use the funds to lower prices for consumers, with the impact expected in the current fiscal third quarter. Home Depot received $730 million in tariff refunds during its fiscal second quarter, using about $685 million to reduce cost of goods sold, which lifted gross margin by 0.3 percentage points; CFO Richard McPhail called that "the vast majority" of what the company expected. In contrast, Lowe's CEO Marvin Ellison said the company will not use its refund to cut prices, instead aiming to "deliver strong profitability for our shareholders."
Lowe's Cuts 2026 Outlook as DIY Pressure Tests Growth
Lowe's Companies, Inc. paired a second-quarter earnings beat with a reset of its fiscal 2026 outlook, putting more weight on whether Pro, Online and Home Services can offset weak discretionary DIY demand. Adjusted earnings reached $4.40 per share, up 1.6% year over year and above the Zacks Consensus Estimate of $4.22, while revenues increased 8.3% to $25,956 million but missed the consensus mark of $26,135 million. Comparable sales rose just 0.2%, with a 2.3% increase in average ticket offsetting a 2.1% decline in comparable transactions. Lowe's now expects fiscal 2026 sales of about $92 billion, flat comparable sales, an adjusted operating margin of approximately 11.6% and adjusted earnings of about $12.25 per share, each at the bottom of the prior guidance range. Management also expects third-quarter adjusted earnings per share to be approximately 7% below the prior-year level. The revised outlook reflects first-half results and current consumer demand and housing trends, keeping the near-term earnings setup restrained.
Walmart, e.l.f. Beauty cut prices with tariff refunds
Major retailers and consumer goods companies are directing tariff refund payments toward price cuts as inflation-fatigued shoppers pull back on spending, according to The Wall Street Journal. The refunds trace back to a Supreme Court decision earlier this year holding that the International Emergency Economic Powers Act did not give President Donald Trump authority to impose those tariffs, an outcome that set off more than $160 billion in payments back to importers. Walmart said it rolled back prices on 11,000 items, including ground beef, using roughly $2.9 billion in tariff refunds, with CFO John David Rainey noting shoppers began making visible spending trade-offs in June as gas prices climbed above $4 a gallon. E.l.f. Beauty, which received about $50 million in refunded tariff payments, permanently lowered prices across around 10% of its catalog after a test that dropped the Halo Glow Skin Tint's price by $4 and drove unit sales up close to 40%; net sales for the quarter ended June 30 climbed 36% to $479.4 million. Tractor Supply channeled its refunds into shielding customers from freight and fuel cost increases, lowering prices on products including pine shavings and premium pet food, while its gross margin edged up to 37.1% for the quarter ending June 27 from 36.9% a year earlier. Not every retailer is passing refunds to shoppers: Lowe's CEO Marvin Ellison told CNBC the company received roughly $80 million in refunds and chose to direct them toward shareholder returns, and Kohl's CEO Michael Bender said the company put $100 million of its refunds into its gross margin and plans to invest the remainder in deeper inventory. Burlington Stores said it plans to reinvest all $55 million of its tariff refunds into lower prices over the second half of its fiscal year.
ELF · Pricing · Positive e.l.f. Beauty permanently lowered prices on ~10% of its catalog using ~$50M in tariff refunds, driving unit sales up ~40%.
WMT · Pricing · Positive Walmart rolled back prices on 11,000 items using roughly $2.9 billion in tariff refunds, a price cut on its own products.
BURL · Pricing · Positive Burlington plans to reinvest all $55 million of tariff refunds into lower prices in H2, a price cut on its own products.
KSS · Capital · Positive Kohl's put $100 million of tariff refunds into gross margin and will invest the remainder in deeper inventory.
LOW · Capital · Neutral Lowe's received ~$80M in tariff refunds and chose to direct them toward shareholder returns rather than price cuts.
TSCO · Pricing · Positive Tractor Supply used tariff refunds to shield customers from freight and fuel cost increases, lowering prices on items like pine shavings and premium pet food.
Lowe's Companies has declared a quarterly dividend of $1.25 per share, unchanged from the previous quarter. The dividend is payable on November 4 to shareholders of record as of October 21, with the ex-dividend date also set for October 21. Based on the current share price, the forward yield is approximately 2.4%.
Retail Q2 Beats Largely Driven by Tariff Refunds, Not Consumer Strength
Four major retailers reported Wednesday morning, all beating expectations and raising guidance, but a significant portion of those profits came from a Supreme Court decision rather than stronger consumer spending. The court struck down IEEPA tariffs on February 20th, triggering roughly $166 billion in collections from some 330,000 importers, with about $100 billion refunded as of July 31st. Walmart disclosed the largest refund, while Lowe's received $80 million, about one-ninth of Home Depot's amount. Abercrombie & Fitch reported record second-quarter net sales of $1.27 billion, up 5%, and earnings of $4.17 per diluted share, but the IEEPA refund contributed $1.75 per share, making underlying EPS about $2.42. Williams-Sonoma stood out with comparable brand revenue up 6.2%, accelerating from 4.8% last quarter, and raised its full-year outlook. Kohl's beat with EPS of $1.28 against roughly $0.55 expected, and Bath & Body Works beat despite a 2.3% sales decline. The macro data shows consumers feel better about today but worse about tomorrow, with core PCE rising 0.2% month over month. Investors should normalize for tariff refunds, watch how retailers deploy the windfall, and focus on companies that didn't need the help, like Williams-Sonoma and Sam's Club.
Lowe's Q2 Sales Rise 8.3% to $26 Billion, EPS Beats
Lowe's reported second-quarter sales of $26 billion, up 8.3% year over year, with comparable sales increasing 0.2%, and adjusted diluted earnings per share of $4.40, which exceeded expectations even excluding a $0.11 benefit from IEEPA tariff refunds. The company recognized $96 million in pre-tax non-GAAP charges from acquisition-related intangible asset amortization in the quarter. Despite heightened competitive pressures from competitors using tariff refunds to lower prices, Lowe's saw strong performance in Pro, Online, and Home Services, with online sales growing 15.7%. The company updated its full-year 2026 outlook to approximately $92 billion in sales, roughly flat comparable sales, adjusted operating margin of about 11.6%, and adjusted diluted EPS of approximately $12.25, reflecting continued soft DIY demand and pressure in residential construction. Lowe's also generated $3.1 billion in free cash flow and paid $673 million in dividends during the quarter.
Lowe's Cuts Full-Year Outlook Despite Earnings Beat
Lowe's Companies reported second-quarter adjusted earnings of $4.40 per share, beating the $4.22 FactSet consensus, but cut its full-year sales forecast to $92 billion and now expects comparable sales to be approximately flat. Total sales rose 8.3% to $25.96 billion, helped by acquisitions, while organic comparable sales increased just 0.2%, below the 0.8% expected. The company cited persistent pressure on discretionary DIY spending and softer housing trends affecting its Foundation Building Materials and Artisan Design Group units. Full-year adjusted diluted EPS is now forecast at approximately $12.25, the bottom of the previous range. Shares closed 2.0% higher at $220 on August 19.
Major US retailers are disclosing how they plan to use billions of dollars in tariff refunds from the federal government. Walmart received approximately $2.9 billion and will lower prices in grocery and general merchandise, while Target got $994 million and used it to boost margins, contributing $1.65 to its $4.11 earnings per share. Amazon received about $600 million and will proactively refund some customers where it can trace passed-on import charges, using the rest to cut prices. Home Depot received $730 million and used $685 million to reduce cost of goods sold, while Lowe's has received $80 million and is still weighing options. The refunds follow the Supreme Court's February ruling striking down tariffs under the 1977 International Emergency Economic Powers Act, with more than $100 billion returned to businesses as of late July.
Corporate earnings this week featured a high-stakes lineup of reports from 12 notable companies across the consumer discretionary, consumer staples, information technology, industrials, and financials sectors. All 12 reporting companies beat consensus earnings estimates, with 11 delivering year-over-year profit expansion. Revenue performance remained strong, as 11 companies topped Wall Street expectations and all 12 achieved year-over-year top-line growth, leaving one firm missing consensus estimates. Among the highlights, Home Depot posted revenue of $47.9 billion and adjusted EPS of $4.92, Lowe's beat on EPS but trimmed its full-year revenue outlook to about $92.0 billion, Walmart shares dropped 9.15% after soft guidance, Target raised its full-year adjusted EPS estimate to $9.90 to $10.90, Analog Devices issued upbeat fiscal Q4 guidance, and TJX raised its full-year EPS guidance to $5.31 to $5.36.
Lowe's Fair Value Estimate Cut to $258.19 as Analysts Trim Q2 Expectations
Lowe's Companies saw its fair value estimate trimmed from roughly US$263.73 per share to about US$258.19 per share as analysts reset Q2 expectations. Several firms including Telsey Advisory, Citi, UBS, Mizuho and Bernstein continue to rate the stock Outperform or Buy even after revising price targets lower, while BofA moved to a Neutral rating citing softer July trends and heavier competitor promotions. The revised model assumes revenue growth of about 4.23%, a net profit margin of about 8.05%, a future P/E multiple of about 23.22x, and a discount rate of about 8.97%. Truist noted five consecutive quarters of positive comparable sales with about 70% of categories positive, while Bernstein and Mizuho flagged comparable sales softness and weaker Q3 commentary tied to Lowe's heavier exposure to discretionary DIY and seasonal categories compared with Home Depot.
LOW · Capital · Negative Analysts trimmed fair value estimate and price targets, with BofA downgrading to Neutral on softer July trends and competitor promotions.
Home Depot faces uphill battle amid a growing customer problem
Home Depot is struggling to reverse a concerning customer trend that continues to impact sales, despite recent efforts to boost demand. In the second quarter of this year, the home improvement chain's comparable U.S. sales increased by 1.3% year over year, but in-store foot traffic declined, with average visits per location dipping 0.6% year over year, steeper than the 0.4% decrease at top rival Lowe's. Chief Financial Officer Richard McPhail said on an earnings call that consumer uncertainty and housing affordability continue to pressure demand for larger home improvement projects, with the number of bigger-ticket projects falling 2.1% over last year. McPhail noted that housing turnover has been at historical lows, with the rate dropping to 2.8% last year, the lowest in at least three decades, and he sees no sign of an inflection point. Home Depot expects comparable sales to remain flat or increase by up to 2% in fiscal year 2026, and is betting on customer experience improvements, including Express Delivery at more than 2,000 U.S. locations and an updated appliance delivery model.
Moderna Shares Surge 177% on Positive Cancer Vaccine Trial Results
Moderna shares surged 177% after its cancer vaccine, developed with Merck, showed positive late-stage trial results. Marvell Technology shares rose 9.9% after announcing a new agreement with Alphabet to develop custom AI chips. Target shares rose 4.3% after reporting second-quarter 2026 earnings of $2.46 per share, beating the Zacks Consensus Estimate of $2.3 per share. Lowe's shares rose 2% after reporting second-quarter 2026 earnings of $4.4 per share, beating the Zacks Consensus Estimate of $4.22 per share.
Moderna, Merck surge on cancer vaccine trial success
Moderna and Merck shares surged after their personalized cancer vaccine showed positive results in a late-stage trial, with Moderna skyrocketing 120% and Merck jumping 10%. Pilgrim's Pride rallied 15% after JBS, which owns more than 80% of the chicken producer, bid to acquire the remaining stock. Gold miners jumped after the Treasury Department announced sharply higher government debt repurchases, sending yields lower and boosting gold, with the VanEck Gold Miners ETF up 9% and Coeur and Hecla each gaining more than 13%. Marvell Technology rose more than 7% after giving Google permission to buy a $12 billion stake as part of a custom chip development deal. Coinbase surged 11% as bitcoin popped more than 5% to about $68,000, while Lowe's gained over 3% despite cutting its full-year outlook to the bottom end of prior guidance. Target added 5% after beating second-quarter revenue expectations and hiking full-year guidance, helped by a $752 million tariff refund boost. La-Z-Boy tanked 16% after fiscal first-quarter adjusted earnings fell 9% and current-quarter revenue guidance missed FactSet consensus, while Mercury Systems slid more than 6% on mixed results. Estee Lauder rose more than 16% after fiscal fourth-quarter adjusted earnings and revenue beat estimates.
Treasury Buyback Doubling Sends Bond Yields Sharply Lower
The U.S. Treasury announced plans to double liquidity support buyback operations on longer-end securities, sending bond yields notably lower and lifting market indexes ahead of the open. The current buyback position of $2 billion per operation will now become $4 billion, with the 30-year bond dropping below 5.3%, the 10-year beneath 4.7%, and the 2-year under 4.2%. Moderna shares surged 95% after its intismeran vaccine met primary goals in Phase 3 testing for preventing cancer in melanoma patients, while partner Merck rose 7%. Target reported beats on both top and bottom lines with earnings of $2.46 per share on revenues of $26.54 billion, but shares fell 1% despite raised guidance. Lowe's posted mixed results with earnings of $4.40 per share beating estimates while revenues of $25.96 billion missed, and TJX Companies outperformed with earnings of $1.22 per share but fell 3.3% on a weaker outlook. Estee Lauder shares jumped 12% after fiscal Q4 earnings of $0.39 per share beat the $0.32 anticipated on revenues of $3.63 billion.
Moderna Surges on Cancer Vaccine Data, Treasury Boosts Buybacks
Moderna shares jumped 95% in pre-market trading after its intismeran vaccine met primary goals in Phase 3 testing for preventing cancer in melanoma patients whose tumors had been surgically removed, while partner Merck rose 7%. The U.S. Treasury said it will double liquidity support buyback operations on longer-end securities from $2 billion to $4 billion per operation, sending bond yields lower and market indexes higher. Target reported beats on both top and bottom lines with earnings of $2.46 per share on revenues of $26.54 billion, but shares fell 1% despite raised guidance. Lowe's posted mixed results with earnings of $4.40 per share beating estimates by 4.27% while revenues of $25.96 billion missed consensus by 0.68%. TJX Companies beat estimates with earnings of $1.22 per share on revenues of $15.18 billion but shares dropped 3.3% on a weaker outlook, and Estee Lauder surged 12% after fiscal fourth-quarter earnings of $0.39 per share on revenues of $3.63 billion beat expectations.
Moderna shares jumped as much as 50% in premarket trading after the drugmaker and Merck said their experimental melanoma drug combination outperformed Keytruda alone in a Phase 3 trial. The INTerpath-001 study tested intismeran autogene, an investigational individualized mRNA-based neoantigen therapy, in combination with Merck's Keytruda in patients with completely resected stage IIB-IV melanoma, meeting its primary endpoint of recurrence-free survival and a key secondary endpoint measuring distant metastasis-free survival. Target stock fell 4.0% despite the retailer raising its annual sales forecast, with investors focusing on the impact of tariffs and the company's underlying profit outlook; comparable sales for the quarter ended Aug. 1 rose 3.8%, beating expectations for 2.5% growth, and tariff refunds provided a nearly $1 billion boost during the quarter. Honeywell Aerospace shares rose 2.8% after Morgan Stanley upgraded the newly independent aerospace company to Overweight from Equalweight and set a $205 price target, while Lowe's shares fell 2.6% after the home improvement retailer reported second-quarter results that beat expectations on earnings but missed badly on revenue. Estée Lauder rose 6.3% in premarket trading ahead of its fiscal fourth-quarter and full-year results, and Rising Dragon Acquisition Corp. surged 223.3% to $18.91 in premarket trading with no clear catalyst identified.
Goldman Sachs warns of consumer spending slowdown as tax refund boost fades
Goldman Sachs economists warn that US consumer spending growth is set to slow sharply in the second half of the year as the temporary boost from higher-than-planned tax refunds fades. Economist Jan Hatzius wrote in a note that second quarter sales at consumer companies rose 5.9% year over year among the median S&P 500 consumer discretionary company and 3.9% for the median consumer staples company, powered by the tax refund surge. Hatzius expects real consumer spending growth to slow to 1-1.5% in the second half as real cash flow stagnates, despite consumer spending accelerating to a 3.2% annualized pace in the second quarter from 0.5% in the first quarter. The thesis will be tested this week with earnings and outlooks from Home Depot, Lowe's, Walmart, and Target, with Walmart most in focus given its third quarter outlook.
Meta social media addiction trial and retail earnings ahead
Opening arguments in the Meta social media addiction trial are scheduled for Tuesday, with a bipartisan group of state attorneys general alleging the company designed features like infinite scrolling and push notifications to keep young users engaged while misleading users about app safety. Meta calls the allegations unsubstantiated and says potential damages could reach as much as 1.4 trillion, with the trial expected to last about seven weeks and CEO Mark Zuckerberg potentially testifying. Later in the week, Walmart and Target report second quarter results, with Walmart's value focus seen as resilient and Target getting a boost from food and health while analysts look for more momentum in discretionary categories. Home Depot and Lowe's earnings will offer a fresh look at the home improvement consumer, with analysts expecting improvement in same store sales driven by professional contractors but caution on big ticket projects possibly weighing on results.
META · Regulation · Negative Opening arguments in Meta social media addiction trial; state AGs allege design features mislead users, potential damages up to $1.4 trillion.
HD · Demand · Neutral Earnings will offer a look at home improvement consumer; analysts expect improvement in same store sales driven by professional contractors but caution on big ticket projects.
LOW · Demand · Neutral Earnings will offer a look at home improvement consumer; analysts expect improvement in same store sales driven by professional contractors but caution on big ticket projects.
TGT · Demand · Neutral Target reports Q2 results; gets boost from food and health, analysts look for momentum in discretionary categories.
WMT · Demand · Positive Walmart reports Q2 results; value focus seen as resilient.
US Trade Deficit Narrows to $101.5 Billion as Tariffs Reshape Winners and Losers
The US goods trade deficit narrowed to $101.5 billion in June 2026, down from $105.9 billion in May, as imports fell but domestic factories have not yet filled the gap. Nucor reported a 92% surge in net income and a 72% stock gain over one year, with finished steel import market share dropping from 23% to 16% under Section 232 enforcement. Consumer sentiment collapsed from 61.7 to 44.8 over the same period, while Lowe's shares fell 11% and gross margin compressed 70 basis points. Union Pacific's intermodal revenue jumped 26%, but Old Dominion Freight Line saw a 7.7% decline in tons per day, signaling that lower imports have not yet translated into more domestic freight. Walmart and Lowe's are absorbing higher costs, with Walmart's inventory up 8.9% and Lowe's comparable sales up just 0.6%.
Lowe's Companies trades at $207.64, seen as 21.3% undervalued with fair value estimate of $263.73
Lowe's Companies stock is trading around $207.64, with a widely followed narrative suggesting the shares are 21.3% undervalued relative to a fair value estimate of $263.73. The acquisition of Foundation Building Materials is expected to sharply accelerate Lowe's access to the large Pro contractor market, especially in underserved regions like California, the Northeast, and the Midwest, unlocking new revenue streams and a larger share of the $250 billion Pro market. However, the company faces integration risks from the FBM and ADG deals, as well as higher debt levels that could pressure margins. The share price is down 15.9% year to date, with a one-year total shareholder return decline of 6.57%, though a recent 2.83% single-day gain hints at shifting sentiment.
LOW · Capital · Positive Analyst fair value estimate suggests 21.3% upside from current price, indicating undervaluation.
LOW · Demand · Positive Acquisition of Foundation Building Materials expected to accelerate access to Pro contractor market, unlocking new revenue streams.
Stagnant home sales halve growth in big and bulky last-mile delivery
Growth in last-mile delivery for big and bulky e-commerce items has slowed by half as stagnant home sales curb demand for large-ticket discretionary items like furniture and appliances, according to a report from Armstrong & Associates and the National Home Delivery Association. The $10.6 billion market for residential delivery of oversized and heavyweight items is now projected to grow at a 5.1% compound annual rate through 2027, down from 10.6% over the prior eight years, reaching an estimated $12.3 billion. Housing turnover hit a 30-year low last year, with only 28 of every 1,000 homes changing hands, a 38% drop from the 2021 pace, while the Trump administration's tariffs on aluminum and steel imports have further raised appliance costs and dampened demand. Gross margins in the segment have dipped from 28.9% in 2022 to 27.5% last year, and carriers face rising costs from diesel fuel, cargo insurance, and labor shortages. Top national providers include RXO Last Mile with $1.2 billion in gross revenue, Ryder E-commerce and Last Mile Services with $983 million, and J.B. Hunt Final Mile Services with $824 million, while a looming competitive threat is vertical integration by large retailers such as Wayfair, Lowe's, and Amazon.
W · Demand · Negative Wayfair is a major online furniture retailer directly affected by stagnant home sales and tariffs reducing demand for big and bulky items.
HD · Demand · Negative Home Depot sells furniture and appliances, and stagnant home sales and tariffs dampen demand for these big-ticket items.
LOW · Demand · Negative Lowe's sells furniture and appliances, and stagnant home sales and tariffs dampen demand for these big-ticket items.
AMZN · Demand · Negative Amazon is a large retailer that may face lower demand for big and bulky items due to stagnant home sales and tariffs, though it is not a top carrier.
Lowe's AI Pro tools and phantom stock awards aim to reshape competitive moat
Lowe's is reinforcing its push into the professional contractor market with AI-assisted tools like 'Material Lists' designed to streamline project quoting and order fulfillment, while directors received additional phantom stock units as deferred compensation to align board incentives with long-term performance. The company projects $100.9 billion in revenue and $8.1 billion in earnings by 2029, requiring 4.5% annual revenue growth and a roughly $1.5 billion earnings increase from the current $6.6 billion. These AI tools support the Pro-focused growth catalyst, though comparable sales guidance remains flat to low single digits and successful integration of the FBM and ADG acquisitions is critical. Four Simply Wall St community fair value estimates range between $229.21 and $263.73, highlighting divergent investor views amid a flat home improvement market and elevated leverage.
Lowe's Companies Could Be 20% Below Fair Value After Earnings Update
Lowe's Companies shares may be undervalued by nearly 20% following its latest earnings report, where revenue beat expectations but full-year EPS guidance came in slightly below analyst estimates. The most followed narrative on Simply Wall St estimates a fair value of $263.73 per share, compared with the last close of $211.63, implying a 19.8% discount. This valuation rests on assumptions including the acquisition of Foundation Building Materials, which is expected to accelerate Lowe's access to the large Pro contractor market and drive above-market sales growth. The fair value estimate uses a discount rate of 8.88% and factors in measured revenue expansion, firmer margins, and a richer future earnings multiple. However, risks remain, including integration challenges around the FBM deal and pressure on comparable sales if housing and big-ticket demand stay subdued.
Home Depot vs. Lowe's: A Look at Recent Revenue Trends for These Home Improvement Giants
Home Depot reported quarterly revenue of $41.8 billion for the period ended May 2026, while Lowe's reported $23.1 billion for the same period, highlighting Home Depot's continued dominance in the home improvement retail industry. Over the past eight quarters, Home Depot's revenue ranged from $38.2 billion to $45.3 billion, consistently outpacing Lowe's, which ranged from $18.6 billion to $24.0 billion. Home Depot benefits from a professional contractor customer base that contributes about half its sales. Both companies faced share price declines amid interest rate headwinds and a soft housing market, with Home Depot hitting a 52-week low of $289.10 in May and Lowe's falling to $203.40 in June. Home Depot's price-to-sales ratio briefly dipped below two for the first time in a year, while Lowe's remains at a compelling 1.3 times sales and recently raised its dividend 4% to $1.25 per share.
Lowe's vs. Floor & Decor: Which Home Improvement Stock Is a Better Buy in 2026?
Lowe's is the clear choice for 2026 over Floor & Decor, according to a Motley Fool analysis, due to its superior expected growth rate and lower valuation ratios. Lowe's fiscal 2025 revenue was approximately $86.3 billion, a 3.1% year-over-year increase, with net income of nearly $6.7 billion, while Floor & Decor's revenue reached nearly $4.7 billion, up about 4%, with net income of close to $209 million. Lowe's forward price-to-earnings ratio stands at 16.8 times versus Floor & Decor's 25.7 times, and both trade at a price-to-sales ratio of 1.3 times. Lowe's is expected to grow sales by about 8% and net income by about 2.5% in 2026, while Floor & Decor anticipates sales rising about 3% to $4.83 billion but net income declining slightly to $206 million. The analysis notes Lowe's is expanding its Pro customer base through AI tools and acquisitions, whereas Floor & Decor faces headwinds from high interest rates and smaller average project sizes.
Home Depot's HVAC and Pro Services Expansion Could Reshape Competitive Balance with Lowe's
Home Depot's push into HVAC and professional contractor services is drawing investor attention as a potential catalyst that could reshape its competitive standing against Lowe's. The company recently rolled out AI-powered tools for Pro Xtra members, including Material List Builder and an expanded Pro digital workspace, aiming to simplify complex job planning and support higher-value projects. Analysts project Home Depot could reach $187.2 billion in revenue and $17.3 billion in earnings by 2029, implying 4.0% annual revenue growth and a $3.3 billion earnings increase from the current $14.0 billion. However, concerns persist over operating margin pressure and elevated capital spending, with community fair value estimates clustering between $351 and $370, suggesting limited upside from the current price.
HD · Technology · Positive Home Depot's rollout of AI-powered tools for Pro Xtra members and expansion into HVAC and pro services could drive higher-value projects and revenue growth.
LOW · Competition · Negative Home Depot's pro services expansion and AI tools may intensify competition and pressure Lowe's market share.
Lowe's Average Brokerage Recommendation Sits at 1.73, Zacks Rank Holds at 3
Lowe's currently has an average brokerage recommendation of 1.73, based on ratings from 31 brokerage firms, with 20 Strong Buy and one Buy recommendation. The Zacks Rank for Lowe's is #3 (Hold), as the Zacks Consensus Estimate for the current year has remained unchanged over the past month at $12.48. The article cautions that brokerage recommendations often carry a positive bias and may not reliably predict stock price movements, suggesting investors use them alongside tools like the Zacks Rank.
LOW · Capital · Neutral Average brokerage recommendation of 1.73 (Strong Buy to Buy) and Zacks Rank #3 (Hold) with unchanged earnings estimate; mixed signals with caution about brokerage bias.
Nordson surges 25% in first half of 2026, leading Dividend Aristocrat picks
Nordson shares jumped 25.5% year to date through June 30, 2026, more than doubling the S&P 500's 9.5% return, after being named one of the three best Dividend Aristocrats to buy in 2026. The company raised its quarterly dividend to $0.82 from $0.78 and reported record fiscal second-quarter adjusted earnings of $2.86 per share on revenue of $740.85 million, with 7% organic growth across all segments and an 18% increase in backlog. Management lifted full-year guidance to sales of $2.93 billion to $3.01 billion and adjusted EPS of $11.30 to $11.80. Aflac, another pick, gained 6.3% and raised its quarterly payout 5.2% to $0.61, while Lowe's fell 8.6% despite beating earnings estimates for six straight quarters and increasing its dividend to $1.25 per share. All three companies extended their dividend growth streaks, underscoring the income-compounding thesis even as Lowe's faced housing-market headwinds.
Lowe’s Raises Dividend to $1.25 Despite Housing Slump, Defying Wall Street Cut Calls
Lowe’s declared a $1.25 quarterly dividend on May 29, 2026, raising the payout from $1.20 and defying widespread expectations of a cut amid the toughest housing market since the financial crisis. The company generated $7.65 billion in free cash flow in the fiscal year ended January 2026, covering the $2.64 billion dividend cost by 2.9 times, while the earnings payout ratio sits in the low-40s on trailing diluted EPS of $11.84. Management slashed share buybacks by 95% to $211 million in fiscal 2026, rotating capital toward dividends and accelerating debt paydown with a $2.4 billion bond repayment in the first quarter. CEO Marvin Ellison called the current environment the most difficult housing market he has faced, yet Lowe’s extended its 26-year streak of annual dividend increases, with per-share payouts rising from $0.12 in 1999 to $4.70 in 2025. The board’s decision signals confidence in medium-term recovery, even as first-quarter organic comparable sales rose only 1% and adjusted EPS of $3.03 missed consensus.
LOW · Capital · Positive Lowe's raised its dividend and maintained a strong payout ratio, signaling financial health and confidence despite a housing slump.
A recent analysis flags Lowe's, Monro, and Warby Parker as consumer stocks with warning signs. Lowe's has seen sales decline 2.6% annually over three years and weak same-store sales, with a gross margin of 33.3%. Monro faces ongoing store closures and a 31.9% annual drop in earnings per share over three years. Warby Parker reports operating margin losses and negative returns on capital despite $890.6 million in revenue.
Dividend Growth Portfolio Overtakes High-Yield Strategy by Year 10, Study Shows
A dividend growth portfolio starting with $45,000 in annual income and growing 8% per year overtakes a high-yield portfolio paying $90,000 but growing only 1% by year 10, according to a recent analysis. By year 30, the growth portfolio pays about $419,000 versus roughly $120,000 for the high-yield strategy, and after adjusting for inflation, the growth portfolio retains approximately $143,000 of today's purchasing power compared to about $31,000 for the high-yield portfolio. Companies such as AbbVie, Lowe's, and Procter & Gamble exemplify dividend growth, returning 460%, 244%, and 141% over ten years respectively while raising payouts annually. The analysis recommends investors model retirement income at different growth rates and reinvest dividends to maximize compounding.
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