Home Depot Inc (NYSE: HD) reported another impressive quarter on Tuesday, beating earnings and revenue expectations and raising its full-year guidance.
Home Depot has been one of the few bright spots in the U.S. brick-and-mortar retail space in recent years, and analysts expect that trend to continue for the foreseeable future.
HD reported second-quarter adjusted earnings per share of $3.05 on revenue of $30.46 billion. Both numbers topped consensus analyst estimates of $2.84 and $30.03 billion, respectively. Revenue was up 8.4 percent from a year ago.
All-important same-store sales were also up 8 percent, beating Wall Street expectations of a 6.6 percent gain and far exceeding the 4.2 percent growth Home Depot reported in the first quarter of 2018. Customer transactions were up 3.1 percent, and average ticket size was up 5 percent to $66.20.
Home Depot said its second quarter benefited from seasonably cold weather in much of the U.S. in the first quarter, which delayed home improvement projects until later in the year.
“We were very pleased with our record second quarter sales and earnings,” CEO Craig Menear says in a statement. “Not only did our seasonal business rebound from the first quarter, but our overall results exceeded our expectations.”
Looking ahead, HD also raised its full-year 2018 revenue growth guidance from 6.5 percent to 7 percent. The company increased its full-year same-store sales growth projection from 5 percent to 5.3 percent and upped its EPS target from $9.31 to $9.42.
Bank of America analyst Elizabeth Suzuki says investors should expect more of the same from Home Depot in the second half of the year.
“HD’s results were better than the BAC card data for the category broadly, and we remain encouraged that economic drivers and demographic trends remain favorable for renovation spending,” Suzuki says.
In the longer-term, she says millennials will continue to support Home Depot’s business.
“Medium-to-long-term stability in comps will be…
Click here to continue reading
Want to learn more about how to profit off the stock market? Or maybe you just want to be able to look sophisticated in front of your coworkers when they ask you what you are reading on your Kindle, and you’d prefer to tell them “Oh, I’m just reading a book about stock market analysis,” rather than the usual “Oh, I’m just looking at pics of my ex-girlfriend on Facebook.” For these reasons and more, check out my book, Beating Wall Street with Common Sense. I don’t have a degree in finance; I have a degree in neuroscience. You don’t have to predict what stocks will do if you can predict what traders will do and be one step ahead of them. I made a 400% return in the stock market over five years using only basic principles of psychology and common sense. Beating Wall Street with Common Sense is now available on Amazon, and tradingcommonsense.com is always available on your local internet!
