It’s turning out to be a strong year for Home Depot, as it records solid earnings for the second quarter of fiscal 2017.
According to the home improvement store’s latest earnings release, sales surged to $28.1 billion for the second quarter of fiscal 2017, a 6.2% increase from the second quarter of fiscal 2016.
The sales beat Street estimates as homeowners continued to invest in their homes that are appreciating in value, an article in Reuters by Sruthi Ramakrishnan stated.
In addition, net earnings for the second quarter of fiscal 2017 increased to $2.7 billion, or $2.25 per diluted share, compared with net earnings of $2.4 billion, or $1.97 per diluted share, in the same period of fiscal 2016.
“We were pleased with our results this quarter as our customers rewarded us with the highest quarterly sales in company history,” said Craig Menear, chairman, CEO and president.
“We also achieved the highest quarterly net earnings in company history,” said Menear.
The Reuters article attributed the increase in profit to two main factors. From the article:
Americans have been spending more on 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.
"We also believe an extended Spring season was positive for Home Depot's outdoor business in 2Q, including outdoor garden," BTIG Research analyst Alan Rifkin said in a pre-earnings note.
The strong quarter was enough for Home Depot to up its forecast for the rest of the year. Looking ahead, based on its year-to-date performance, Home Depot now expects sales to be up approximately 5.3%. The Company also raised its diluted earnings-per-share growth guidance for the year and now expects diluted earnings-per-share growth of approximately 13% from fiscal 2016 to $7.29.