Despite existing concerns about softening existing home sales, Home Depot reported quarterly earnings that raised its sales outlook for 2018.
Home Depot now expects sales in fiscal 2018 to grow 7.2 percent, up from a previous outlook of 7 percent. It says sales per square foot during the third quarter were up 5.2 percent from a year ago, customer transactions rose 1.4 percent and the average shopper’s ticket was up 3.6 percent. The company warns it still faces tough comparisons because of devastating storms last year.
In the fourth quarter, Home Depot will be comparing against roughly $380 million in hurricane sales booked during the fourth quarter in 2017, CFO Carol Tome said.
CNBC compared what Home Depot reported compared with what Wall Street was expecting, based on a survey of analysts by Refinitiv:
Earnings per share: $2.51 vs. $2.26 expected
Revenue: $26.30 billion vs. $26.26 billion expected
Same-store sales: up 4.8 percent globally vs. growth of 4.7 percent expected
Still, Home Depot CEO Craig Menear said Tuesday there is continued “overall strength of demand in the home improvement market,” prompting the company to hike its outlook for fiscal 2018.
Home Depot reported fiscal third-quarter net income of $2.9 billion, or $2.51 per share, up from $2.2 billion, or $1.84 per share, a year earlier. Earnings per share came in better than the $2.26 expected by analysts polled by Refinitiv. Net sales rose roughly 5 percent from a year ago to $26.30 billion, slightly beating expectations of $26.26 billion.
Sales at stores open for at least 12 months were up 4.8 percent globally and up 5.4 percent in the United States. Home Depot said sales per square foot were up 5.2 percent from a year ago, customer transactions rose 1.4 percent, and the average shopper’s ticket was up 3.6 percent. Looking to the full year, Home Depot now expects sales to grow roughly 7.2 percent, up from a previous outlook of just 7 percent. It says same-store sales should be up 5.5 percent, up from 5.3 percent. Home Depot also said Tuesday it now expects to complete roughly $8 billion in share repurchases for the year, up from initial plans for $6 billion. Home Depot shares are up about 12 percent from a year ago to trade around $183