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Highlights
- Home Depot, Inc. (NYSE:HD) reported net sales growth of 10.7% to US$35.7 billion for the fourth quarter ended January 30, 2022.
- Its earnings per share diluted increased by 21.2% to US$3.21 compared to US$2.65 per share diluted in the year-ago quarter.
- Home Depot raised the quarterly dividend by 15% to US$1.90 per share.
Home improvement retailer Home Depot, Inc. (NYSE:HD) reported a 10.7% growth in fourth-quarter sales on Tuesday, prompting it to raise the quarterly dividend and revenue forecast.
The Home Depot (HD) stock, listed on the Dow Jones Industrial Average and the Standard & Poor's 500 indexes, traded at US$347.00, up 0.04% in the premarket after the results.
Home Depot’s board has decided to increase the quarterly dividends by 15% to US$1.90 per share, or the equivalent of an annual dividend of US$7.60 per share.
The company will pay the latest dividend hike to shareholders on record as of March 10, 2022, and payable by March 24, 2022.
Home Depot has been paying cash dividends for 140 consecutive quarters.
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Fourth-quarter result:
The company reported net sales growth of 10.7% to US$35.7 billion in the quarter ended January 30, 2022, compared to US$32.2 million in the same quarter of the previous year.
Its same-store sales or comparable sales increased by 8.1% YoY in Q4, FY2021, while the same-store sales in the US grew by 7.6% in the quarter.
The net earnings came in at US$3.35 billion, up 17.3% over the previous year, and the earnings per share diluted rose 21.2% to US$3.21 against US$2.65 per share diluted a year ago.
The demand for home improvement products kept growing during the covid restrictions, helping generate better-than-expected revenue.
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Full-year 2021
Its net sales were US$151.2 billion, up 14.4% from the previous year, while the same-store sales and US comparable sales rose by 11.4% and 10.7%, respectively, in FY 2021.
The net earnings were US$16.4 billion, up around 27% increase YoY, compared to US$12.9 billion in fiscal 2020. Its earnings per share diluted increased to US$15.53 in FY 2021 from US$11.94 per share diluted in FY 2020.
Its customer transactions remained nearly flat at US$1,759 million in fiscal 2021. However, the average ticket increased to US$83.04 in FY 2021 compared to US$74.32 in FY 2020.
The sales per retail square foot rose 11.21% YoY to US$604.74 from US$543.74 in fiscal 2020. It shows customers’ increased interest in the products.
Its cash and equivalents stood at US$2.34 billion as of January 30, 2022, compared to US$7.9 billion as of January 31, 2021. Its merchandise inventories increased to US$22.07 billion as of January 30, 2022, from US$16.62 billion as of January 31, 2021.
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Fiscal 2022 Guidance
Home Depot expects its sales growth and comparable sales growth to be positive in fiscal 2022. The operating margin to remain flat.
It expects the diluted earnings per share growth to remain in the low single digits in FY2022. The Atlanta, Georgia-based Home Depot operates roughly 2,317 retail stores and employs around 500,000 associates.
Its current market capitalization is US$362 billion, and the stock rose more than 25% in one year at the closing price of US$346.87 on February 18, 2022.
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Bottomline
The Home Depot’s better-than-expected results have boosted its expectations. Chairman and CEO Craig Menear said Home Depot’s US$150-billion sales in FY2021 is a significant milestone. He thanked the supplier partners and associates for their dedication to serving customers.
