- HD sees fiscal year comparable sales drop by 3% to 4%, previously saw about a 1% drop.
- Sales growth expected at 2.5% to 3.5%, previously saw about a 1% growth.
- Operating margin forecasted at 13.5% to 13.6%, previously witnessed around 14.1%.
- Earnings per share (EPS) growth expected to decline by 2% to 4%, previously saw a 1% growth.
- Second-quarter comparable sales decreased by 3.3% year-over-year, estimate was a decline of 2.39%.
- US comparable sales down by 3.6% year-over-year, estimate was a decline of 2.63%.
- Net sales reached $43.18 billion, a 0.6% increase year-over-year, but below the $43.79 billion estimate.
- Adjusted EPS was $4.67, beating the estimate of $4.52.
- Actual EPS was $4.60, slightly down from $4.65 year-over-year.
- Customer transactions dropped by 1.8%.
- Average ticket sales were $88.90, down by 1.3% year-over-year.
- Sales per square foot decreased by 3.6%.
- Merchandise inventories stood at $23.06 billion.
- Store count increased to 2,340 locations, a 0.6% year-over-year rise.
- SG&A expenses totaled $7.14 billion, up by 3.3% year-over-year.
- Total sales included $1.3 billion from the recent acquisition of SRS Distribution, representing approximately six weeks of sales in the quarter.
- Fiscal 2024 guidance updated to include 53 weeks of operating results and the performance in the first half of fiscal 2024, along with SRS Distribution.
- Higher interest rates and greater macro-economic uncertainty pressured consumer demand in the home improvement sector, leading to weaker spending.
- Despite current challenges, the CEO highlights strong long-term fundamentals supporting home improvement demand.
Home Depot Inc on Smartkarma
Analysts on Smartkarma, such as Baptista Research, have been covering Home Depot Inc closely, providing valuable insights on the company’s performance. In their report titled “The Home Depot Inc.: The Influence of Housing Turnover and Interest Rate Environment! – Major Drivers,” it was noted that in the first quarter of 2024, Home Depot’s total sales decreased by 2.3% compared to the same period last year. The company’s comp sales also saw a decline of 2.8%, with US stores reporting negative comps of 3.2%. Diluted earnings per share for the first quarter were $3.63, down from $3.82 in the previous year.
In another report by Baptista Research titled “The Home Depot Inc.: Strategic Investment in Pro Ecosystem & Interconnected Experience & Other Developments – Major Drivers,” the focus was on the company’s performance in Q4 2023. The earnings report highlighted both opportunities realized during the fiscal year and challenges faced, leading to a moderate overall performance. Home Depot saw a 3% sales decline in fiscal year 2023, with comp sales dropping by 3.2% and earnings per share standing at $15.11, down from $16.69 in the previous year. Baptista Research aims to assess various factors influencing Home Depot’s future stock price and perform an independent valuation of the company using Discounted Cash Flow (DCF) methodology.
A look at Home Depot Inc Smart Scores
| Factor | Score | Magnitude |
|---|---|---|
| Value | 2 | |
| Dividend | 3 | |
| Growth | 3 | |
| Resilience | 2 | |
| Momentum | 4 | |
| OVERALL SMART SCORE | 2.8 |
Smart Score is a compound score for the Company indicating its overall outlook. It is derived by taking an equally weighted average of underlying Factor scores computed by Smartkarma
Home Depot Inc, the home improvement retailer, shows a promising long-term outlook based on the Smartkarma Smart Scores. The company’s superior momentum score of 4 indicates strong market performance and positive price trends, setting a solid foundation for potential growth opportunities. Additionally, with respectable scores in dividend and growth factors at 3 each, Home Depot demonstrates stability and the potential for future expansion. Although values and resilience scores are slightly lower at 2, the overall outlook remains positive for Home Depot’s continued success in the home improvement sector.
Operating across the U.S., Canada, China, and Mexico, Home Depot caters to a wide range of customers with its assortment of building materials, home improvement products, and services. With a focus on maintaining momentum and fostering growth, supported by its dividend payouts, Home Depot is well-positioned to navigate market challenges and capitalize on emerging opportunities in the long run.
Disclaimer: This article by Smartkarma is general in nature and based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Note that our articles may not factor in the latest price-sensitive company announcements or qualitative material.
While all reasonable care has been taken in the preparation, Smartkarma makes no assurance about the accuracy of any generated data or content. All content is indicative only and should be independently checked for accuracy and confirmed before use. Smartkarma accepts no responsibility for any loss or damage caused as a result of any inaccuracy or error within the Lab online tools or generated data.
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