Financial Research Report: Lowe's Companies, Inc Essay

Words: 1943
Pages: 8

Financial Research Report: Lowe’s Companies, Inc
Strayer University

Abstract
Review of Financial Research Report: This assignment is an analysis of a US publicly-traded company; its common stock could be a prospective investment. The report is due in Week 10, in needs to be at least 5 pages, and it needs to cover the following topics:
Company Overview: Conduct research and describe the company, its operations, locations, markets, and lines of business. Collect financial statements for the past three years, fiscal or calendar.
Ratio analysis: Perform trend and ratio analysis on current and fixed assets, current and long term liabilities, owner’s equity, sales revenues, EBIT, net income, and earnings per share. Project these trends
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The declining real estate market in 2008 and 2009 also affect Lowe’s net sales. “A weak housing market means more foreclosures, which means that home construction declines. Lowe's sales depend on new housing construction because it provides many home builders with the materials they need to build a home” (“Lowe’s Companies,” 2010, para 12). A weak housing market and a slow economy also means that homeowners are less likely to spend money on home improvement projects. If a homeowner knows that his home is decreasing in value over time, he won't bother to repair it to increase its value until home prices start increasing. “Additionally a weak US economy means that people are saving more rather than spending on discretionary goods or projects. As a result of the weak housing market, Lowe's net sales fell by 2.1% in 2009 (“Lowe’s Companies,” 2010, para 12). However, when the US government gave a lucrative tax credit to home buyers, the number of pending home sales increased during the first four months of 2010. “Taking this a possible sign that the housing market was recovering, consumers spent more money on home improvement projects, and as a result Lowe's sales increased by 4.7% in Q1 2010” (“Lowe’s Companies,” 2010, para 13).
According to “Lowe’s Reports Fourth Quarter Sales and Earnings Results” (2011), Lowe’s sales are expected to increase five