Yahoo Finance's Brian Sozzi and Julie Hyman break down the latest quarterly earnings for Lowe's.

Video Transcript

JULIE HYMAN: Going from TJX to Lowe's is very interesting here, and not only that, going from Home Depot yesterday to Lowe's today is pretty fascinating as well. So the company is raising its forecast for the full year for comparable sales, and this is after the numbers last quarter beat estimates. What's interesting is it's still saying that comp sales this year could be down 1%, to up 1%, but that's better than the prior forecast.

BRIAN SOZZI: Now while Home Depot, Julie, yesterday taking one for the team here, stock got absolutely obliterated here, down 9. That was Home Depot's move yesterday. You saw a lot of analysts over the past, I want say 12-15 hours or so, come on here and defend Home Depot here for its strong business model and otherwise stronger quarter, viewing that reaction as an overreaction.

Lowe's here benefiting, because its shares were under pressure yesterday. Coming out here today, Julie, with an, I would say, the stock is trading here off of that full year guidance from the company here. So Lowe's looking for earnings this year of 13.10-13.60 a share. The Street was looking for at 11.96 a share. So a pretty upbeat outlook from Lowe's.

Same store sales in the quarter, fourth quarter, in the US up 5.1%. Not as good as Home Depot, but still a solid result. And then lastly, Julie, these two companies are probably some of the most aggressive companies in corporate America right now, buying back their stock.

Last year, get this, Lowe's bought back $13.1 billion worth of its stock last year. That is a huge number. Well, you look over at Home Depot, they repurchased $14.8 billion worth of their stock. So these companies are generating lots of cash, plowing that back into just their business in terms of bringing down their share counts, boosting their earnings, and patting any inflationary pressures on their business.

JULIE HYMAN: Yeah. One more contrast I want to draw between the two companies, by the way, potentially, is Marvin Ellison, Lowe's CEO saying in the statement that they remain confident in their ability to expand operating margin. And I think in this market, making a comment like that is pretty reassuring to investors, right? Where so many companies are saying the perhaps potentially the ability to continue to expand that margin through the course of the year might be muted. And I'll have to check out the call there to see if that's going to be from, for example, raising prices, or if they think there's going to be increased volume here.

BRIAN SOZZI: Yeah. One thing I do want to call, shed a little light on here, Julie, and it's something I heard on the Macy's earnings call yesterday, a little bit on Home Depot's. So and I think investors have to watch when they hop on these TJX earnings calls and Lowe's as well, some signs of price resistance by US consumers. A lot of these retailers, those companies that I just mentioned, have started to push through major price increases on consumers and you are starting to see, I would say, a little resistance by shoppers to some of these increases, most notably in the home improvement space.

A lot of those big ticket projects like remodeling your kitchen, those are getting significantly more expensive. And somehow, some homeowners, some consumers might be starting to balk about that. How that plays out later this year in terms of volume of sales, to be determined, but I don't think The Street likes to hear that stuff.

JULIE HYMAN: Yeah, no it does not.