Lowe's still no match for Home Depot

Lowe’s was hoping not to be outshined by Home Depot’s strong financial results, but hopes turned into missed opportunities Wednesday as Lowe's reported disappointing profit growth.

For the second quarter ended July 31, Lowe’s had earnings of $1.13 billion, up from $1.04 billion in the same quarter last year. On a diluted basis, earnings were $1.20 a share, 4 cents below analysts’ estimates. Home Depot reported a much higher profit on Tuesday.

Same store sales at Lowe's increased 4.6% for the second quarter and 4.9% for the six month period. Sales for the second quarter increased 4.5% to $17.3 billion from $16.6 billion in the second quarter of 2014.

"We posted solid results for the quarter and were able to capitalize on big-ticket market share opportunities with strong growth in categories like appliances and outdoor power equipment," commented Robert A. Niblock, Lowe's chairman, president and CEO. "I would like to thank our employees for their hard work and commitment to serving customers during this important selling season."

On Tuesday Home Depot said that it benefited from consumers increasingly spending on their homes instead of their wardrobes, but Lowe’s was not able to capitalize on that trend enough for Wall Street.

"Our year-to-date earnings per share performance was in line with our expectations. This, together with the execution of our strategic priorities, gives us confidence in our Business Outlook for 2015," Niblock added.

Delivering on its commitment to return excess cash to shareholders, the company repurchased $1.5 billion of stock under its share repurchase program and paid $218 million in dividends in the second quarter. For the six month period, the company repurchased $2.5 billion of stock under its share repurchase program and paid $440 million in dividends.

As of July 31, Lowe's operated 1,846 home improvement and hardware stores in the United States, Canada and Mexico representing 201.4 million square feet of retail selling space.

Lowe's said it expects full-year earnings of $3.29 per share.