The nation's largest home improvement retailer, Home Depot (NYSE: HD), posted strong third-quarter results that beat analysts' estimates and raised its outlook based on a growing housing industry.
Home Depot said sales rose 7.4 percent to $19.5 billion, beating analysts' estimates of about $19.2 billion. Same-store sales rose 7.4 percent, with an 8.2 percent increase in the United States. The retailer also reported a profit of $1.35 billion, or 95 cents a share, up from $947 million, or 63 cents a share, a year earlier.
Home Depot again raised its outlook for the year, now predicting earnings of $3.72 a share on revenue growth of 5.6%, from its prior view of $3.60 a share and 4.5% revenue growth.
The recovery of the housing market, which took a major plunge during the financial crisis of 2009, has led to a growth in spending among professional contractors and homeowners, Home Depot said. The rise in home prices has sparked a renewed interest in home-improvement projects as more consumers invest in and upgrade their properties. As such, the retailer reported a four percent increase in number of transactions in the quarter to 344.3 million while the average purchase climbed 3.2 percent to $56.27.
In order to support customers during this period of growth in the home industry, Home Depot said it has improved distribution across its 2,260 stores in the US, cut costs and tailored marketing and merchandising efforts to local markets.
Shares of Home Depot rose 3.3 percent to $82.30 in premarket activity on Tuesday following the earnings report.
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