Home Depot, Inc. (HD) Earnings Disappoint Prior To Market Open

home depotBy The original uploader was Alex43223 at English Wikipedia [Public domain], via Wikimedia Commons

Before the market opened, The Home Depot, Inc. (NYSE:HD) Q1 earnings that failed to impress many investors. While the housing market may be improving, these gains were offset by terrible weather that slowed the home improvement retailer. The company reported a profit of $1.00 per share with while up 12.5% year-over-for the same quarter from $0.83, there was a twist.

The reported earnings of 1.00 per share included a $0.04 benefit to earnings related to the sale of HD Supply. When this one-time benefit is excluded, its earnings of $0.96 per share failed to reach analysts’ predictions of $0.99. Revenue climbed a mere 2.9% to 19.7 billion for the quarter with Wall Street looking for revenues of $19.9 billion for the period.

Home Depot: Weather slows sales

“The first quarter was affected by a slow start to the spring selling season. But we had solid results in non-weather affected markets and expect our sales for the year to grow in line with the guidance we previously provided,” said Frank Blake, The Home Depot, Inc. (NYSE:HD)’s chairman and chief executive.

For stores open at least a year in all 50 states and  Washington D.C., sales increased 3.3%. When you factor in stores in Puerto Rico, Guam, Mexico, and 10 Canadian provinces the metric rose by just 2.6%.

The Home Depot, Inc. (NYSE:HD) also increased its full-year earnings forecast from $4.38 to $4.42.

That guidance calls for fiscal 2014 sales to grow 4.8% from a year earlier, 17.6% higher than the prior fiscal year and inclusive of $3.75 billion in share repurchases intended for the balance of 2014.

“The first quarter was impacted by a slow start to the spring selling season,” Chairman and CEO Frank Blake said in Home Depot’s earnings release. “But we had solid results in non-weather impact markets and expect our sales for the year to grow in line with the guidance we previously provided.”

Today’s trading

Shares of The Home Depot, Inc. (NYSE:HD) fell 1.3% Tuesday morning in early trading but have subsequently rebounded. Home Depot is presently trading (10:23AM EDT) at $77.99 up $1.49 for a gain of 1.12%.

Rival Lowe’s Companies, Inc. (NYSE:LOW) was also down 1.1% in pre-market trading but joined The Home Depot, Inc. (NYSE:HD) in rebounding. Both companies are down about 7% for 2014 with Lowe’s reporting its first quarter earnings tomorrow.

About the Author

Brendan Byrne
While studying economics, Brendan found himself comfortably falling down the rabbit hole of restaurant work, ultimately opening a consulting business and working as a private wine buyer. On a whim, he moved to China, and in his first week following a triumphant pub quiz victory, he found himself bleeding on the floor based on his arrogance. The same man who put him there offered him a job lecturing for the University of Wales in various sister universities throughout the Middle Kingdom. While primarily lecturing in descriptive and comparative statistics, Brendan simultaneously earned an Msc in Banking and International Finance from the University of Wales-Bangor. He's presently doing something he hates, respecting French people. Well, two, his wife and her mother in the lovely town of Antigua, Guatemala. To contact Brendan or give him an exclusive, please contact him at theflask@gmail.com