CEO Calls Out HGTV for Turning Lowe’s Shoppers Into Couch Potatoes

Lowe's just dropped its earnings report, and it's more depressing than that unfinished basement you've been "planning" to renovate since 2019. The home improvement giant barely scraped past Wall Street’s expectations, but investors are sitting at their desks wishing they could go back in time and buy another stock (we’ve all been there).

The brutal truth is… Americans would rather binge reruns of “Property Brothers” on HGTV than replace that cracked bathroom tile. And I’m not just making sh*t up, HGTV just hit record ratings, up 25%, while Lowe’s comparable sales took a 1.1% dip year-over-year.

CEO Marvin Ellison basically summed it up: "We're waiting for homeowners to get off the couch and pick up a hammer" (looks like you’re gonna be waiting awhile, Marvin). Earnings came in at $2.89 per share (beat expectations), but the market's response? A big, fat "meh."

Why aren't people renovating? Interest rates are high (hovering around 7%), and general economic uncertainty have turned home renovations into a luxury few can afford. The average homeowner would rather watch Chip and Joanna Gaines and fantasize about a farmhouse renovation (they live in New York) than actually spend money. Ellison admitted that Hurricane damage and professional contractors are basically keeping Lowe's alive right now.

The company's expecting total sales between $83 billion and $83.5 billion, with comparable sales still projected to decline 3% to 3.5%. Wall Street's reaction? Lowe's stock dropped 4.9% faster than your Wi-Fi connection during the Jake Paul vs. Mike Tyson Netflix debacle.

But here's a hot take: This might be a buying opportunity. While everyone's pessimistic, Lowe's is positioning itself for the eventual home improvement rebound. When interest rates drop (and you bet your bottom dollar they will), this stock will make a comeback. That said, Bernstein analyst Zhihan Ma isn't convinced yet, rating Lowe's an "Outperform" with a $306 price target. 

But here's the thing – Lowe's stock (Up 26% YTD) is pretty overpriced, trading at 20x earnings. But until Lowe’s shows it’s more than just "beating the lowered bar," smart money’s staying cautious. (Think Bronny with the Lakers: lots of potential, but let’s see some stats first.)

Keep Lowe's on your watchlist like that show everyone says you "have to watch," but don't smash that buy button just yet. Wait until the home improvement market stops acting like it's allergic to spending money.

PS: Our breaking alert had some massive swings throughout the day yesterday, and based on the short interest we’re seeing, we could see a squeeze before the market closes. Click here to access the ticker.

Stock.News has positions in Lowe’s and Netflix mentioned in article.