Recovering housing market buoys The Home Depot earnings
The nascent housing recovery pushed The Home Depot’s first-quarter sales 7.4% higher as the company recorded net earnings of $1.226 billion, or 83 cents a share, up 18% from $1.035 billion, or 68 cents a share, a year earlier.
The Atlanta-based home improvement retailer posted $19.1 billion in sales for 1Q 2013, lifted by seasonal changes and a recovering housing market.
"In the first quarter, we saw less favorable weather compared to last year, but we continue to see benefits from a recovering housing market that drove a stronger-than-expected start to the year for our business," said Frank Blake, chairman & CEO of The Home Depot.
Comparable-store sales – or sales at stores open for at least a year – grew 4.3%.
The Home Depot (HD) finished the quarter more optimistic, raising its fiscal 2013 sales guidance, projecting sales to be up 2.8% and comparable store sales to rise 4% this year.
It also raised its fiscal 2013 earnings outlook to $3.52 a share, an increase of 17% from earlier estimates.
The massive retailer is heavily dependent on the nation's housing outlook. Just this week, analysts started to tie a nascent recovery in housing to overall economic growth.
Fannie Mae released a more optimistic report Monday suggesting the economy could pick up additional speed in the second half with the housing recovery continuing to gain traction.