Home Depot Posts First Positive Sales in Two Years

Home Depot reports positive same-store sales growth for the first time since Q3 2022, breaking a streak of declines. This development could influence investor sentiments positively as the company forecasts modest growth moving forward.

Date: 01-03-2025

AI Rating: 7

Overview of Home Depot's Recent Performance

Home Depot has achieved a significant milestone by reporting positive same-store sales for the first time since Q3 2022, indicating a potential recovery in consumer spending within the retail sector. This report highlights several important metrics that are key for investors.

Same-Store Sales Growth
For fiscal Q4, Home Depot reported a same-store sales increase of 0.8%, outperforming analyst expectations of a 1.7% decline. U.S. same-store sales rose by 1.3%. Furthermore, the retailer noted that 10 out of 16 product categories saw positive growth, signaling improved demand across a range of products.

Revenue Growth
Home Depot's overall revenue surged by 14%, reaching $39.7 billion, an increase attributed to an additional week in the quarter and the acquisition of SRS Distribution. This revenue growth is a positive sign for investors, highlighting the company's potential for recovery.

Earnings Per Share (EPS)
Adjusted EPS for Home Depot increased by 7%, reaching $3.02, surpassing the analyst consensus estimation of $3.01. This positive performance reinforces investor confidence in the company's profitability.

Future Outlook
Looking forward, Home Depot anticipates revenue growth of 2.8% while forecasting a slight decrease in adjusted EPS by about 2%. The firm acknowledges ongoing threats from high-interest rates affecting large remodeling projects but has mentioned that it expects its performance to exceed industry averages.

Investors should consider the overall positive trends in same-store sales and revenue while being mindful of the guided decline in EPS and challenging external economic conditions. The recovery in same-store sales could potentially lead to a more favorable stock price as investors perceive a reduction in risk and an increase in consumer confidence.

Stocks: HD