Home Depot (HD) stock is struggling for direction Tuesday after the home improvement retailer beat top- and bottom-line expectations for its third quarter and raised its full-year outlook.
In the three months ended October 27, Home Depot's revenue increased 6.6% year over year to $40.2 billion even as its comparable-store sales dipped 1.3% – including a 1.2% decline in the United States. Meanwhile, its earnings per share (EPS) decreased 1.8% from the year-ago period to $3.78.
"While macroeconomic uncertainty remains, our third-quarter performance exceeded our expectations," said Home Depot CEO Ted Decker in a statement. "As weather normalized, we saw better engagement across seasonal goods and certain outdoor projects as well as incremental sales related to hurricane demand. I would like to thank all of our associates for their dedication in serving our customers and communities."
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
The results handily beat analysts' expectations. Wall Street was anticipating revenue of $39.3 billion and earnings of $3.64 per share, according to CNBC.
As a result of its strong performance, Home Depot raised its full-year outlook. The company now expects to achieve revenue growth of approximately 4%, up from its previous forecast of 2.5% to 3.5%. It added that it expects its earnings per share to decline approximately 1% from the prior year, compared with its previous forecast for a drop of 1% to 3%.
Is Home Depot stock a buy, sell or hold?
Home Depot has done well on the price charts so far in 2024, up 20% on a total return basis (price change plus dividends). And Wall Street is overwhelmingly bullish toward the Dow Jones stock.
According to S&P Global Market Intelligence, the average analyst price target is $414.98, representing implied upside of nearly 3% to current levels. Additionally, the consensus recommendation among the 40 covering analysts it tracks is a Buy.
Financial services firm Truist Securities is one of the most bullish outfits on the consumer discretionary stock with a Buy rating and $459 price target.
"While the company had the benefit of favorable/warm weather for most of the quarter and incremental storm-related sales, third quarter unequivocally came in better than what we expected three months ago," says Truist analyst Scot Ciccarelli.
The analyst adds that proprietary data indicated that sales trends continued to improve over the three-month period, both before and after the devastating hurricanes that hit this season.
"Further, as we highlighted in our preview, our data indicated that October was the first monthly year-over-year sales gain for Home Depot and Lowe's (LOW, Buy) in well over two years, which we think is an important inflection in trend," he says.
Related Content
-
80-Year Old Dick Durbin, the Senate’s No. 2 Democrat, To Retire After 44 Years in Congress‘In my heart, I know it’s time to pass the torch,’ Senator Durbin said in a statement.
-
Stock Market Today: Stocks Rise on Good VolatilityInvestors, traders and speculators continue to process the "known unknown" of global tariff-and-trade war negotiations.
-
Stock Market Today: Stocks Rise on Good Volatility
Investors, traders and speculators continue to process the "known unknown" of global tariff-and-trade war negotiations.
-
Before You Invest Like a Politician, Consider This DilemmaAs apps that track congressional stock trading become more popular, investors need to take into consideration some caveats.
-
How to Put Together Your Personal Net Worth StatementNow that tax season is over for most of us, it's the perfect time to organize your assets and liabilities to assess your financial wellness.
-
Stock Market Today: Trump Retreats, Markets RejoiceStocks rally, yields soften, the dollar rises, and even beaten-down names enjoy the wages of potential trade peace.
-
Tesla Stock Pops as Elon Musk Promises DOGE Draw BackTesla reported a sharp drop in first-quarter earnings and sales, as the EV maker suffered a backlash to its CEO's political ambitions.
-
Bouncing Back: New Tunes for Millennials Trying to Make ItAdele's mournful melodies kick off this generation's financial playlist, but with the right plan, Millennials can finish strong.
-
Early-Stage Startup Deals: How Do Convertible Notes Work?Some angel investors support early startups by providing a loan in exchange for a convertible note, which includes annual interest and a maturity date.
-
Stock Market Today: Stocks Soar on China Trade Talk HopesTreasury Secretary Bessent said current U.S.-China trade relations are unsustainable and signaled hopes for negotiations.
