Categories Earnings, LATEST, Retail

Home Depot stock drops as revenue miss estimates

Home Depot Inc. (HD) reported a 4.4% increase in sales to $24.9 billion for the first quarter of 2018 compared to the prior-year period. Comparable sales were positive 4.2%, and US comparable sales were positive 3.9%. The company posted strong results in all markets and categories outside the seasonal business.

Net earnings were $2.4 billion or $2.08 per diluted share compared with $2 billion or $1.67 per diluted share in the prior year period.

The company beat market estimates on earnings numbers but missed out on revenue. Home Depot’s stock dropped more than 2% in premarket trading.

Home Depot first quarter 2018 earnings
Home Depot Q1 2018 Earnings Infographic

During the quarter, Home Depot saw a 1.3% decline in customer transactions while average ticket increased 5.8%. Sales per square foot saw an improvement of 4.5% from the same period last year.

Favorable trends in the housing market and on the economic landscape act as tailwinds for the company. In the retail industry, home improvement is performing well.

Home Depot has started seeing robust business with contractors, and this has helped it perform better than some of its peers like Lowe’s Companies Inc. (LOW) and Bed, Bath and Beyond (BBBY).  Home Depot has also been working on its e-commerce plans and appears to be strong enough to withstand the Amazon effect.

Home Depot expects sales for fiscal 2018 to grow by about 6.7% and comp sales to be up around 5%. The company expects diluted earnings to improve by about 28% from fiscal 2017 to $9.31 per share.

Most Popular

Cost reduction has become a priority for FedEx (FDX) after a challenging quarter

Shares of FedEx Corporation (NYSE: FDX) were up 1% on Tuesday. The stock has dropped 44% year-to-date and 34% over the past 12 months. The company delivered mixed results for

Prime Medicine is the next big biotech to pursue IPO. Here’s all you need to know

After a soft start to the year, the IPO market has witnessed muted activity so far though a few big companies entered the stock market. On the heels of AIG

Stock Watch: Is Darden Restaurants a good buy after earnings?

After a prolonged slowdown, the restaurant industry is returning to normal patterns but macroeconomic uncertainties and high inflation are currently playing spoilsport for it. While the pandemic-related slump forced many

Tags

Add Comment
Loading...
Cancel
Viewing Highlight
Loading...
Highlight
Close
Top