Home Depot earnings, revenue top expectations

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Home Depot cashier at a Miami store.

Home Depot reported fiscal fourth-quarter sales and earnings that topped Wall Street's expectations Tuesday, providing further evidence that the housing recovery still has legs.

The retailer meanwhile announced a 29 percent increase in its dividend, to 89 cents per share, and a $15 billion repurchase program.

Home Depot shares increased roughly 2 percent in premarket trading, as investors shook off the company's full-year 2017 earnings per share estimate of $7.13. Wall Street had been expecting Home Depot to forecast full-year earnings per share of $7.17.

Here's how the retailer did versus analysts' forecasts:

  • EPS: $1.44 a share vs. $1.34 a share, adjusted, expected by a Thomson Reuters consensus forecast
  • Revenue: $22.21 billion vs. $21.8 billion expected by Thomson Reuters
  • Comparable sales: 5.8 percent increase vs. the 3.7 percent increase expected by FactSet

"Our focus on providing localized and innovative product selection, improving the interconnected customer experience, and driving productivity resulted in record sales and net earnings for 2016," Craig Menear, chairman, CEO and president of Home Depot, said in a statement.

The home improvement chain has benefited from a stronger economy and rising home values, which have encouraged shoppers to invest in their homes.

Even as the company faces tough comparisons from the prior-year period, analysts expect it to perform better than the broader retail space due to this ongoing shift in consumer spending.

Indeed, Home Depot was up against a 7.1 percent increase in same-store sales during the prior year's fourth quarter, when unseasonably warm weather allowed contractors and homeowners to continue working on outdoor projects through the winter.


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