Lowe’s profit rises but misses estimates

MOORESVILE, N.C. (AP) — Lowe's third-quarter net income increased 26%, as the home-improvement retailer was bolstered by the housing market's ongoing recovery.

Its earnings were a penny per share short of Wall Street expectations, but revenue beat forecasts.

The Mooresville, N.C., company boosted its fiscal 2013 outlook again on Wednesday, but the earnings forecast was still below expectations.

Lowe's shares dropped almost 3% in premarket trading to $48.98.

Home improvement companies have been benefiting from record-low interest rates and rising home prices, spurring customers to spend more to renovate their homes.

Lowe's financial report comes a day after larger rival Home Depot's third-quarter results topped analysts' estimates and it lifted its outlook.

HOME DEPOT: Earnings beat Wall Street estimates

Lowe's earned $499 million, or 47 cents per share, for the period ended Nov. 1. That's up from $396 million, or 35 cents per share, a year ago. Analysts polled by FactSet expected earnings of 48 cents per share.

Revenue rose 7% to $12.96 billion from $12.07 billion. Wall Street forecast $12.73 billion in revenue.

Sales at stores open at least a year rose 6.2%. This metric is a key indicator of a retailer's health because it excludes results from stores recently opened or closed.

Lowe's now expects full-year earnings of about $2.15 per share. Revenue is predicted to climb approximately 6 percent. Based on 2012's revenue of $50.52 billion, the new forecast implies approximately $53.53 billion.

The company's prior outlook was for earnings of $2.10 per share, with revenue up approximately 5 percent. It had increased that forecast in August from a previous guidance for earnings of about $2.05 per share and revenue up about 4 percent.

Analysts predict fiscal 2013 earnings of $2.20 per share on revenue of $53.09 billion.

Lowe's had 1,831 stores in the U.S., Canada and Mexico at quarter's end.