Q3 Report on Tap
Home Depot’s third-quarter report is slated for release on November 14 at 6:00 a.m. ET. On average, analysts following the company forecast Q3 earnings of $3.58 per share, compared to $4.24 per share in the comparable period of last year. The consensus revenue estimate is $35.66 billion. The top line will likely be impacted by softness in customer traffic while higher costs might weigh on margins.
A few months ago, the company’s leadership in a statement said it expects full-year sales and earnings to decline year-over-year, citing the muted demand from professional contractors and do-it-yourself customers, which account for a major chunk of sales.
From Home Depot’s Q2 2023 earnings call:
“Going forward, as we continue to navigate a unique and uncertain environment, our focus continues to be on operating with agility as we respond to evolving customer dynamics while also driving productivity and efficiency throughout the business. …we operate in a large and fragmented $950 billion-plus addressable market. We remain committed to growing the business and believe we are well positioned to continue capturing market share.”
Mixed Outcome
Both earnings and sales beat analysts’ forecasts in the June quarter, after missing in the preceding quarter. The company has an impressive track record of delivering better-than-expected quarterly results. Second-quarter earnings declined to $4.65 per share on net sales of $42.9 billion, which is down 2% from last year. Comparable sales growth decelerated to 2% year-over-year in Q2 from 4.5% in the prior quarter.
HD Supply, Home Depot’s industrial supply division, recently acquired flooring solutions provider Redi Carpet as part of the efforts to expand the portfolio.
Home Depot’s stock closed the last trading session slightly higher but stayed below its long-term average. It has lost 7% since the beginning of the year.