Home Depot tops Street 3Q forecasts
Atlanta — Home Depot’s third-quarter net income increased 14 percent as comparable-store sales climbed in the U.S.
The nation’s biggest home improvement retailer stuck to its outlook for all of 2014, but said that it could not account for all possible losses from a massive data breach it revealed in September that affected 56 million debit and credit cards. For now, the company is putting those costs at $34 million as it pertains to its guidance for 2014.
Home Depot earned $1.54 billion, or $1.15 per share, for the three months ended Nov. 2. That compares with $1.35 billion, or 95 cents per share, a year earlier.
The housing sector had been hit hard early in the year both by bad weather and by tight conditions in the market due to rising mortgage rates and a tight supply of homes. That dragged down the earnings of home improvement retailers, yet Home Depot appears to be distancing itself from those early rough months, beating Wall Street’s per-share expectations by a couple cents, according to a poll of analysts by Zacks Investment Research.
Revenue for the Atlanta company climbed 5 percent to $20.52 billion from $19.47 billion. That also beat the $20.42 billion in revenue that analysts had expected.
Sales at stores open at least a year rose 5.2 percent. In the U.S., the figure increased 5.8 percent.
Home Depot maintained its forecast for fiscal 2014 earnings of about $4.54 per share. It still expects sales to climb approximately 4.8 percent.
Analysts polled by FactSet predict full-year earnings of $4.51 per share.
Home Depot said that going forward, costs related to its data breach may include liabilities to payment card networks for reimbursements of credit card fraud and card reissuance costs; liabilities from current and future civil litigation, governmental investigations and enforcement proceedings and other potential costs.
Those costs may have a material adverse effect on its fourth-quarter results, as well as on future periods, the company said.
Home Depot Inc. has 2,266 stores in all 50 states, the District of Columbia, Puerto Rico, the U.S. Virgin Islands, Guam, 10 Canadian provinces and Mexico.
Rival Lowe’s Cos. reports its quarterly results Wednesday.
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