Home Depot Earnings Surge 72%, Hikes Outlook

Home DepotHome Depot's (HD) fourth-quarter net income rose 72 percent as more people started on home-improvement projects. The retailer also raised its earnings guidance and dividend.

Home Depot also posted its first yearly revenue increase since 2006, before the recession and housing crash hammered the home-improvement business.

Fourth-quarter net income rose to $587 million, or 36 cents per share, from $342 million, or 20 cents per share last year. Analysts expected 31 cents per share, according to FactSet.

Revenue rose 4 percent to $15.13 billion. Analysts expected $14.81 billion.

Revenue in stores open at least a year rose 3.9 percent globally and 4.8 percent in the U.S. The measure is considered an important gauge of a retailer's financial health because it excludes stores that open or close during the year.

For the year, net income rose 25 percent to $3.34 billion, or $2.01 per share, from $2.66 billion, or $1.57 per share. Revenue rose 2.8 percent to $68 billion.

For 2011, the company expects net income to rise 9.5 percent to $2.20 per share. That's up from a prior forecast of a 7 percent to 9 percent increase. Analysts expect $2.25 per share.

Home Depot expects revenue to rise 2.5 percent, from a prior forecast of 2 percent to 2.5 percent. That implies revenue of $69.7 billion. Analysts predict revenue of $69.28 billion.

The Atlanta company also raised its quarterly dividend 6 percent to 25 cents, payable March 24 to shareholders of record as of March 10.

Home Depot plans to buy back about $2.5 billion in shares throughout 2011.

Home-improvement retailers are seeing signs of life from shoppers as the housing industry slowly improves and the consumers slowly start to spend normally again after a slowdown during the recession.

Home Depot Inc.'s chief rival, Lowe's Cos., is scheduled to report its results Wednesday.

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Thats because people are re-doing and building their own homes.....cause contractors and home builders are rip offs....

February 23 2011 at 11:56 PM Report abuse rate up rate down Reply

Two very important items are left out of this "reporting" of great incoming revenue. If one only includes those stores making money or profit and not the ones that closed, then naturally an increase of income will very likely show up. Secondly, there is not percentage of price increases overall in the products sold year to year......usually counted as inflation. If the markup of "junk" items that did not sell in the last year or last six months were counted on the items sold in the last month, one could find a fantastic increase in "profit". I note the price of copper items alone. Sorry, I am very suspect of this infomercial for Home Depot. Next time have the report include everything and I bet the picture painted will be very different.

February 22 2011 at 10:36 AM Report abuse rate up rate down Reply

WOW, what brokerage house decided it was time to hype Home Depot? I was at my local Depot store yesterday. To say I probably could have jumped on a hilo and driven around the store without being bothered is probably an understatement. I'm not sure which there were fewer of, employees or customers. Honestly, it looked like the store had been abandoned.

February 22 2011 at 9:28 AM Report abuse rate up rate down Reply