Sales rose the most for the first quarter of the year.
Retailers exceeded quarterly earnings expectations. Earnings per share were $ 4.09, up from $ 3.86 a year earlier. Analysts had expected earnings of $ 3.69 per share.
“This quarter’s strong performance is even more impressive because we were comparing it to last year’s historic growth and this year has seen a slow start in the spring,” said CEO Ted Decker.
Home Depot (Ticker: HD) has increased its 2022 guideline for sales growth by 3% and operating margin by about 15.4%. It expects EPS growth to be “in the middle single digits”.
First-quarter sales rose to $ 38.9 billion from $ 37.5 billion a year earlier, a 3.8% increase. On a comparative-store basis, global sales grew by 2.2% and US stores by 1.7%.
The stock has risen more than 4% in premarket trading, although it has made some gains, rising 0.2% to $ 296.54 in recent checks.
The unexpected rise in the Home Depot forecast is a particularly welcome development, as concerned investors are concerned about the ongoing demand for home improvement. The Covid-19 led to a good deal of housing and housing-related projects – and the cold weather delayed the normal spring season.
The quarter was not a perfect one: Like many other companies, Home Depot saw gross margin pressure and management cited inflation in its conference call. Despite this, the company is still seeing healthy demand in the face of rising prices and a shaky real estate market.
This is likely to boost investors’ expectations for rival LOW, which will release results on Wednesday.
Home Depot, the largest home improvement company, is considered a bellwether for customers. The epidemic, which has now exceeded its two-year limit, has sent everyone into nesting mode.
In the wake of a white-hot housing market and the ongoing wave of Covid-19 variants, last year was huge for home improvement companies, both of which kept consumers spending for their accommodation.
Yet even the biggest bulls did not expect these layers to be sustainable as we returned to a more normal environment.
Expectations for the quarter were mixed. For most parts of the country, a cold spring has coincided with a cooling effect of high interest rates, which has pushed up mortgage prices, meaning that already high house prices are even more expensive for borrowers.
Still, as Baron’s Note that home improvement retail does not have to be traded simultaneously with the housing market, there are other catalysts behind this sector.
Foot traffic is at least relatively good compared to the pre-epidemic period. According to the data compiled for Baron’s From Placer.ai, seven visits were positive in the 12 weeks from the beginning of February to 18 April — the most recently available তুল compared to the same week in 2019. The last four of this week were down between 4.3% and 6.6. %, But it may be true that 2019 was a more normal environment, when there was a general spring spike demand.
Write to Teresa Rivas at [email protected]