Home Depot's US sales slow as DIY consumer demand wanes
US same-store sales climbed 3.4% in second quarter ended Aug. 1
Villere and Company portfolio manager Sandy Villere on the state of the economy impacting how to best allocate capital.
Home Depot Inc on Tuesday missed Wall Street estimates for U.S. same-store sales for the first time in seven quarters, as the pandemic-driven surge in demand for do-it-yourself home-improvement products waned.
The Atlanta, Georgia-based company's shares, which have gained more than 26% this year, fell 4.9% in pre-market trading.
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Home-improvement chains had a blockbuster 2020 as revenue and profit surged from stuck-at-home Americans splurging on paint, tools, and gardening equipment to upgrade their living spaces through DIY projects.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| HD | THE HOME DEPOT INC. | 395.57 | +2.98 | +0.76% |
The steady rollout of COVID-19 vaccines, however, prompted more Americans to return to outdoor activities and abandon some pandemic-induced shopping habits.
U.S. same-store sales at Home Depot climbed 3.4% in the second quarter ended Aug. 1 - the smallest increase in two years, while analysts had expected an increase of 4.9%, according to IBES data from Refinitiv.
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Overall net sales rose 8.1% to $41.12 billion, beating estimates of $40.79 billion.
Net earnings in the reported quarter rose 11% to $4.81 billion. The home-improvement retailer earned $4.53 on a per-share basis, beating estimates of $4.44 per share.
(Reporting by Uday Sampath in Bengaluru; Editing by Sherry Jacob-Phillips)