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Home Depot Lifts FY17 View Again As Q3 Tops Estimates


Home Depot Inc. (HD), the world's largest home improvement retailer, on Tuesday lifted its fiscal 2017 earnings and sales forecast again after reporting higher third-quarter profit and sales with strong comparable sales growth. Both earnings per share and top line beat market estimates.

In pre-market activity, Home Depot shares were gaining around 1.43 percent to trade at $168.08.

According to the firm, the positive revision in fiscal 2017 outlook reflects its year-to-date performance, underlying strength of the core business, and projected hurricane recovery sales.

Craig Menear, chairman, CEO and president, said, "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."

For fiscal 2017, the company now expects earnings per share growth of approximately 14 percent from fiscal 2016 to $7.36. The earnings-per-share growth guidance includes the impact of $8 billion of share repurchases for fiscal 2017.

The company previously expected earnings-per-share growth of approximately 13.0 percent from fiscal 2016 to $7.29.

On average, 33 analysts polled by Thomson Reuters expect earnings of $7.34 per share for the year. Analysts' estimates typically exclude special items.

Sales are now expected to be up approximately 6.3 percent and comp sales will be up approximately 6.5 percent.

Previously, the company was projecting sales to grow approximately 5.3 percent and comp sales to grow approximately 5.5 percent.

In the third quarter, net earnings were $2.17 billion, 10% higher than $1.97 billion in 2016. Earnings per share increased 15 percent to $1.84 from $1.60 in the prior year.

Net sales were $25.03 billion for the third quarter, an 8.1 percent increase from last year's $23.15 billion.

Analysts expected earnings of $1.82 per share for the quarter on sales of $24.55 billion.

Comparable store sales for the third quarter of fiscal 2017 were positive 7.9 percent, and comp sales for U.S. stores were positive 7.7 percent.

The company estimates that hurricane-related sales positively impacted comparable store sales growth by approximately $282 million in the fiscal third quarter.

Operating income grew 10.8 percent from last year to $3.68 billion. Gross profit was $8.65 billion, up 7.5 percent.

In the quarter, number of Customer Transactions increased 2.5 percent, and average ticket grew 5.1 percent to $62.84.

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