Even though Home Depot’s (NYSE: HD) second-quarter earnings were better than expected, the stock is trading 0.6% down in premarket trading on Tuesday.
The $5.05 EPS and $43.79 billion in revenue that HD posted beat analysts’ estimates of $4.98 EPS and $43.57 billion in revenue. Again surpassing expectations, comparable sales came in at +5.8%, above forecasts of +4.56%.
The business reaffirmed its full-year sales projection, which calls for a +3% increase in comparable sales. Goldman Sachs’ analyst Kate McShane believes the stock will rise “given the top and bottom line beats and maintained 2022 outlook.”
For investors worried about the category’s viability in the second half of 2022, McShane said in a client note, “We expect this quarter’s numbers and any insight into Q3 presented on the call will assuage some worry.”
Dan Oppenheim, an analyst at Credit Suisse, called the sustained forecast “remarkable” given the continuing slowdown of existing house sales because such turnover tends to stimulate some repair and renovation work.
Joseph Feldman, an analyst at Telsey Advisory Group, shared optimistic thoughts on the findings. The analyst concluded, “Home Depot should remain a winner in retail” because of the company’s “best-in-class execution,” “digital proficiency,” and the fact that more people are engaging in maintenance and repair thanks to hybrid work-from-home arrangements.
Shares of Home Depot are still down more than 20% year to date.
Home Depot runs retail outlets where customers may purchase supplies for construction, renovation, repair, and upkeep of buildings and use in the home. Flooring, cabinet and cabinet makeovers, countertops, heating, air conditioning, and window installation are all part of the company’s repertoire.
It also offers equipment and tool rentals. Homeowners are the company’s primary clientele, while they also work with general contractors, maintenance staff, handymen, property managers, BSCs, and specialists like electricians, plumbers, and painters.
Home Depot also has an online storefront and sites selling bespoke window coverings, textiles, and home decor. The corporation has 2,317 locations in the United States as of 2021. They were established in 1978 with headquarters in Atlanta, Georgia.