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The Home Depot Beats Earnings Estimates, Office Depot Misses

The Home Depot and Office Depot released their latest earnings reports before opening bell this morning, with one missing consensus and the other beating. Home Depot posted earnings of $1.17 per share and $21 billion in revenue, against the consensus estimates of $1.10 per share and $20.39 billion.

Office Depot reported non-GAAP earnings of 7 cents per share and $3.5 billion in revenue, compared to the consensus estimates of 11 cents per share and $3.56 billion in revenue. In the year-ago quarter, the retail chain posted earnings of 7 cents per share and $3.8 billion in sales.

The Home Depot Beats Earnings Estimates, Office Depot Misses

Home Depot shares rise on strong sales growth

Home Depot’s comparable store sales grew 7.1% with an 8.9% increase in U.S. comparable sales. For the full year, the home improvement retailer saw sales rise 6.4% to $88.5 billion with a 5.6% year over year increase in comparable store sales and a 7.1% increase in comparable U.S. store sales. Full-year earnings rose to $5.46 from $4.71.

For this year, Home Depot expects sales to grow by between 5.1% and 6% and comparable store sales to grow by 3.7% to 4.5%. The retail chain expects to open five new stores in Mexico and about 12% to 13% earnings per share growth after expected share repurchases. Management expects earnings of $6.12 to $6.18 per share, against the consensus of $6.16 per share.

The company’s board voted to up its dividend 17% to 69 cents per share. The dividend will be paid on March 24 to shareholders of record as of March 10.

Shares of Home Depot edged higher by 22.58% to $126 in premarket trading.

Office Depot’s North America sales remain flat

Office Depot’s GAAP earnings were 3 cents per share, compared to a loss of 15 cents per share in the year-ago quarter. The merger with Staples is still pending, and management said the status of the merger disrupted business during the fourth quarter. The company took charges of $40 million related to merger with Office Max and the pending acquisition of Staples.

North America Retail sales slipped from $1.5 billion to $1.4 billion, while the region’s Business Solutions sales slipped from $1.46 billion to $1.36 billion. International sales fell from $834 million to $712 million.

Office Depot shares climbed by 1.15% to $5.28.