Home Depot Q2 Results Beat Estimates, Lifts FY14 Earnings View

(RTTNews) - Home improvement retailer Home Depot Inc. (HD) reported Tuesday higher profit in its second quarter with improved sales and comparable store sales. Earnings per share and top line beat market estimates. Further, the company lifted its earnings view for fiscal 2014, and backed sales growth forecast.

In pre-market activity, Home Depot shares are gaining $2.72 or 3.25 percent, and trading at $86.31.

For the second quarter, net earnings were $2.05 billion, 14.2 percent higher than last year's $1.80 billion. Earnings per share climbed 22.6 percent to $1.52 from $1.24 a year ago.

On average, 28 analysts polled by Thomson Reuters expected earnings of $1.45 per share for the quarter. Analysts' estimates typically exclude one-time items.

The firm's sales were $23.81 billion for the recent quarter, a 5.7 percent increase from the prior year's $22.52 billion. Analysts estimated revenues of $23.61 billion for the period.

Comparable-store sales for the second quarter were positive 5.8 percent, and comp sales for U.S. stores were positive 6.4 percent.

Gross profit of $8.16 billion increased 5.7 percent from last year, and operating income of $3.45 billion grew 14.2 percent.

In the quarter, number of Customer Transactions increased 4.2 percent, and sales per square foot grew 5.5 percent.

Frank Blake, chairman and CEO, said, "In the second quarter, our spring seasonal business rebounded, and we saw strong performance in the core of the store and across all of our geographies. I would like to thank our associates for their hard work and dedication, especially at this time of increased demand."

At the end of the second quarter, the company operated a total of 2,264 retail stores in all 50 states, the District of Columbia, Puerto Rico, U.S. Virgin Islands, Guam, 10 Canadian provinces and Mexico.

Looking ahead for fiscal 2014, Home Depot now expects earnings per share to be up around 20.2 percent from last year to $4.52 for the year. The company previously projected full-year earnings per share growth of approximately 17.6 percent to $4.42 per share.

The outlook includes the benefit of share repurchases of $3.5 billion and its plan to buy back an additional $3.5 billion of shares over the remainder of the year.

Further, the company continues to expect sales to grow nearly 4.8 percent from fiscal 2013.

Analysts project earnings per share of $4.41 for the year on sales of $82.53 billion, which represents a growth of 4.70 percent.