Home Depot, the world's largest home improvement chain, reported higher-than-expected profit and sales, helped by a strong U.S. housing market, and set a $15 billion share repurchase plan.
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Shares of the company, which also forecast 2017 sales ahead of Wall Street estimates, were up 1.8 percent at $145.59 in premarket trading on Tuesday.
The Atlanta, Georgia-based company said it expects 2017 sales to increase by 4.6 percent, which translates to $98.95 billion. Analysts on average had expected $98.45 billion, according to Thomson Reuters I/B/E/S.
Home Depot also forecast 2017 same-store sales growth of 4.6 percent and a profit of $7.13 per share.
The company said same-store sales rose 5.8 percent during the quarter ended Jan. 29, beating analysts' average estimate of a rise of 3.5 percent, according to research firm Consensus Metrix.
U.S. homebuilding jumped 11.3 percent in December as a firming economy and higher wages due to a tightening labor market boosted demand for rental housing.
Moreover, higher consumer spending and an increase in the value of homes have spurred remodeling activity by homeowners.
Home Depot reported a 5.8 percent rise in quarterly sales to $22.21 billion. Analysts on average had expected $21.81 billion.
The company's net earnings rose to $1.74 billion, or $1.44 per share, in the fourth quarter, from $1.47 billion, or $1.17 per share, a year earlier.
Analysts on average had expected $1.34 per share.
Home Depot said its new buyback plan replaced the $4 billion of share repurchases left under its previous plan.
The company's board increased the quarterly dividend to 89 cents per share, payable on March 23, from 69 cents per share.
(Reporting by Gayathree Ganesan in Bengaluru; Editing by Shounak Dasgupta)