Home Depot Inc (NYSE:HD) stock rose 3.03% (As on February 24, 11:11:10 AM UTC-4, Source: Google Finance) after the company posted fourth-quarter results that edged past analyst forecasts, offering some reassurance that the business remains stable even as its core customers pull back on spending. The company reported net income came to $2.57 billion, or $2.58 per share, down from $3 billion a year earlier. Same-store sales, the measure retailers use to strip out the effect of new openings, rose 0.4% overall and 0.3% in the United States, a modest improvement but not a sign of any meaningful recovery in demand. Customer transaction volumes fell 1.6%, though the average receipt edged up to $91.28 from $89.11. In the quarter, the regional performance varied, with our Northern and Western division posting positive comps. In local currency, Mexico reported positive comps and Canada reported negative comps.
Moreover, existing US home sales fell 8.4% in January to their slowest annualised pace in more than two years, while consumer confidence hit its lowest reading since 2014 in the same month. This year, SRS grew organic sales by a low single-digit % and expanded market share, despite pressured industry demand and lack of storms in the back half of the year. In addition to the GMS acquisition, they completed several tuck-in acquisitions and opened a number of greenfield locations across their verticals.
HD in the fourth quarter of FY25 has reported the adjusted earnings per share of $2.72, beating the analysts’ estimates for the adjusted earnings per share of $2.52, according to the Zacks Consensus Estimate. The company had reported the adjusted revenue decrease of 3.8 percent to $38.2 billion in the fourth quarter of FY25, beating the analysts’ estimates for revenue by 0.05%. In the fourth quarter, the gross margin was approximately 32.6%, a decrease of approximately 20 basis points from the fourth quarter last year, primarily reflecting a change in mix as a result of the GMS acquisition
Additionally, the company has approved a 1.3% increase in its quarterly dividend to $2.33 per share, which equates to an annual dividend of $9.32 per share.
For fiscal 2026, Home Depot forecast total sales growth of 2.5% to 4.5% and adjusted earnings per share roughly flat to up 4% against last year’s $14.69. The company expects Comparable sales growth to be of approximately flat to 2.0%, plans to open approximately 15 new stores and 40-50 SRS locations, gross margin to be of approximately 33.1% and Adjusted operating margin to be of approximately 12.8% to 13.0%.