Lowe's Earnings Report: What to Expect on August 19

Lowe's is set to release its fiscal second-quarter earnings on August 19, and investors are waiting with bated breath. The home improvement retailer has been struggling with soft demand, which led management to maintain a low outlook for the year.

Last quarter, Lowe's reported better-than-expected results, but its shares have still fallen by about 10.5% year-to-date. The stock is already trading at a cheap valuation compared to its main peer, Home Depot.

The upcoming earnings release could trigger another pullback if the numbers don't meet expectations. However, such a dip could create an attractive entry point for long-term investors looking to open a new position in the stock or increase an established one.

Lowe's has made significant acquisitions, including Foundation Building Materials and Artisan Design Group, which are part of its pivot toward a greater focus on the contractor market. While these purchases have increased its top line, sluggish same-store sales coupled with higher interest expense and lower margins have led to less-stellar near-term bottom-line results.

Analysts expect Lowe's earnings to grow 7.8% next fiscal year and by nearly 10% in the following fiscal year. The company is trading for around 17 times forward earnings, compared to a forward multiple of 23.5 for Home Depot. This could leave room for multiple expansion in the years ahead.