Home improvement retailer Home Depot, Inc. (HD) Tuesday reported a higher first-quarter profit that was benefited from a recovering housing market. Net sales grew 7 percent and surpassed analysts' expectations. The company also lifted its outlook for fiscal 2013. In pre-market trading, the shares are currently up about 4 percent.
Frank Blake, chairman and CEO of the company stated, "In the first quarter, we saw less favorable weather compared to last year, but we continue to see benefit from a recovering housing market that drove a stronger-than-expected start to the year for our business."
In the first quarter, the company's net earnings increased to $1.23 billion or $0.83 per share from $1.04 billion or $0.68 per share in the prior year.
On average, 26 analysts polled by Thomson Reuters expected the company to earn $0.77 per share for the quarter. Analysts' estimates typically exclude special items.
Net sales for the quarter grew 7.4 percent to $19.12 billion, which also came above analysts' estimate of $18.68 billion. Due to the 14th week in the fourth quarter of fiscal 2012, first quarter sales benefited from a seasonal timing change that added about $574 million to sales, the company said.
On a like-for-like basis, comparable store sales were positive 4.3 percent. Comparable store sales for U.S. stores were positive 4.8 percent.
For fiscal year 2013, the company now expects earnings per share to increase about 17 percent to $3.52. Earlier, it forecast earnings growth after anticipated share repurchases of around 12 percent to $3.37 per share.
Home Depot now anticipates 2013 sales to be up around 2.8 percent, with comparable store sales increase of nearly 4 percent. The prior guidance was for sales growth of nearly 2 percent, and comparable-store sales increase of some 3 percent.
Analysts expect the company to report earnings of $3.54 per share, on revenues of $77.01 billion for fiscal 2013. The firm said its full-year sales and earnings-per-share guidance is based on a 52-week year, compared to fiscal 2012, a 53-week year.
The earnings-per-share guidance includes benefit of its year-to-date share repurchases and intent to repurchase $4.4 billion in additional shares over the remainder of the year, which will bring the total dollar amount of shares repurchased to $6.5 billion for the year, the company noted.
At the end of the first quarter, the company operated a total of 2,257 retail stores in all 50 states, the District of Columbia, Puerto Rico, U.S. Virgin Islands, Guam, 10 Canadian provinces and Mexico.
Home Depot shares closed Monday's regular trading at $76.76 on the NYSE. In the pre-market activity, the shares are currently up 3.50 percent.
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