Home Depot Boosts Guidance After Q3 Earnings Beat Views
Home-improvement retailer Home Depot (HD) reported third-quarter results Tuesday that topped views and raised its full-year outlook.
XAutoplay: On | OffEstimates: Earnings per share of $1.81, up 13%, on revenue of $24.47 billion, up 6%. Same-store sales were seen rising 5.4%, according to Consensus Metrix.
Results: EPS of $1.84 on revenue of $25.03 billion. Same-store sales grew 7.9%. Hurricanes hit operating profit by $51 million but lifted comp sales by $282 million.
Outlook: Full-year EPS now seen at $7.36, due in part to addition buybacks, on comp sales growth of 6.5%, up from a prior view of EPS of $7.29 on comp growth of 5.5%. Analysts see EPS of $7.32. The full-year view implies Q4 EPS of $1.60 vs. consensus views for $1.59.
“Though this quarter was marked by an unprecedented number of natural disasters, including multiple hurricanes, wildfires in the West, and earthquakes in Mexico, the underlying health of our core business remains solid,” said Chairman and CEO Craig Menear in a statement.
Stock: Shares were down 1.1% at 163.50 in premarket trading on the stock market today. The stock was still within buy range of an irregular base with a 160.96 buy point. Rival Lowe’s (LOW), which reports next week, dipped 0.7%.
As other retailers struggle with e-commerce and discounts, Home Depot has also in large part managed to stay above the fray, helped by a solid housing market. That market has made it easier for homeowners to spend money to renovate the homes they’ve already bought or plan to sell, a Moody’s analyst noted recently.
But shares of Home Depot and Lowe’s fell early this month on news that the House GOP tax-reform plan would tighten the limit on the mortgage interest deduction.
After Sears last month announced it would stop selling Whirlpool (WHR) products over disagreements on pricing, Credit Suisse said that Home Depot and Lowe’s among the stores that could see an uptick in business as a result.