Home Depot (NYSE: HD) announced its results for the most recent quarter on May 15, 2012. The Home Depot is a home improvement retailer that sells an assortment of building materials, home improvement and lawn and garden products.
Earnings season is important to investors because it shows how much profit is left in the company's hand after deducting costs from revenue.SEE: Everything Investors Need To Know About Earnings
The Numbers:
Home Depot's EPS topped estimates and revenues were in line with expectations. The company reported 68 cents/share versus the 65 cents per share estimate and revenues of $17.8 billion versus the $17.81 billion estimate. EPS rose 36% while revenue climbed 5.8% from the same period last year. For the first quarter, the company reported net income of $1 billion, up 23.2% from the year-ago quarter. Last quarter marked the third in a row of rising net income.
Management Quote:
"We saw a stronger-than-expected start to the year, driven by record warm weather and continued demand for core products," said Frank Blake, chairman & CEO. "I would like to thank our associates for their hard work and dedication."
A Look Back:
Net income has increased 18.7% year-over-year on average across the last five quarters. The biggest gain came in the fourth of the last fiscal year, when income climbed 31.9% from the year-earlier quarter.
The company's cost of sales rose to 65.3% of revenue, just 5.7% from the year-earlier quarter.
Looking Ahead:
Analysts have a more positive outlook for the company's next-quarter performance. Over the past month, the average estimate for the second quarter has gone up from 97 cents per share to 98 cents. Increasing earnings estimate is a positive sign about the company and it typically leads a increase in the stock price. Over the past three months, the average estimate for the fiscal year has climbed from $2.75 per to share to $2.90.
(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)
