This morning, Lowe’s Companies (LOW) reported fiscal fourth-quarter EPS of $2.28, vs. $1.78 last year, which was $0.07 better than expectations. The company benefited from an extra week in the quarter, along with a nearly 10% drop in outstanding shares, as the company continues its aggressive buyback program. Comparable store sales, which adjusts for the extra week in the quarter, fell 1.5%, reflecting the recent weakness in the housing market.

Guidance for the January 2024 fiscal year was slightly light on the revenues side, with the company looking for revenues between $88 billion and $90 billion, versus expectations of $90.5 billion. However, EPS guidance of $13.60 to $14.00 was pretty much in line with expectations. Operating margins are expected to remain solid between 13.6% and 13.8%, and buybacks should continue to lift results.

I still feel there is value in LOW’s stock at 15X this year’s estimates, with earnings likely getting a lift when the Federal Reserve eventually eases and housing rebounds. LOW remains a buy below $215. My target is $260.

Last Friday, Brady Corp. (BRC) reported a solid fiscal second quarter. Revenues were up 2.6%, or 6.3% excluding the impact of currency. Organic sales grew 7.4% for the Identification Solutions division and 2.8% for the Workplace Safety division. Operating margins widened as the company’s supply situation improved, and Brady kept tight control over operating expenses. EPS grew to 15.7% to $0.81, up from $0.70, which was $0.01 better than expectations.

Brady raised its EPS guidance for the fiscal year to between $3.40 and $3.60, which compared to previous guidance for $3.30 to $3.60 due to greater supply chain certainties. At just over 15X the high end of this range, there is still value in this high-quality company. Buy BRC under $50. Please note, I am lowering my target to $62 given Fed tightening lasting longer than I previously expected.