Home Depot Inc (NYSE:HD) reported higher-than-expected quarterly profit and comparable sales on Tuesday, and also raised its full-year sales and profit forecast.
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Shares of the No. 1 U.S. home improvement chain were up 2.3 percent in premarket trading.
Americans have been investing more in their homes as property prices are on the rise in a subdued U.S. housing market, which is facing a supply crunch.
Home Depot had previously called out price appreciation as one of the primary motivators for people to invest in their homes, BTIG Research analyst Alan Rifkin said in a pre-earnings note.
The company on Tuesday said it now expects full-year sales to grow 5.3 percent, comparable sales to rise 5.5 percent and earnings of $7.29 per share for the year ending January.
It had previously forecast sales to grow 4.6 percent, comparable sales to rise 4.6 percent and earnings of $7.15 per share.
Sales at stores open for more than a year rose 6.3 percent, above the 4.9 percent growth expected by analysts polled by research firm Consensus Metrix. Comparable sales at U.S. stores increased 6.6 percent.
Net income rose to $2.67 billion, or $2.25 per share, in the second quarter ended July 30, from $2.44 billion, or $1.97 per share, a year earlier.
Net sales rose 6.2 percent to $28.11 billion.
Analysts on average had expected earnings of $2.22 per share on revenue of $27.84 billion, according to Thomson Reuters I/B/E/S.
(Reporting by Sruthi Ramakrishnan in Bengaluru; Editing by Martina D'Couto)