The Home Depot Beats Earnings Estimates, Office Depot Misses

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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.

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.

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