Thread: Home Depot Profit Rises 72%

FEBRUARY 22, 2011, 10:06 A.M. ET.

Home Depot Profit Rises 72%


By MAXWELL MURPHY

Home Depot Inc. said its fiscal fourth-quarter profit climbed 72% amid sales gains in the U.S., and the home-improvement chain provided 2011 guidance at or above the views it gave in December.

Atlanta-based Home Depot also boosted its dividend nearly 6%, and reiterated its goal to raise the payout every year. The retailer ultimately wants to return 40% of its earnings to shareholders through dividends, but is closer to 50% currently, intimating per-share earnings growth will outpace payout increases through a combination of organic growth and share repurchases, including the $2.5 billion in buybacks that Home Depot plans for this year.

For the quarter ended Jan. 30, revenue rose 3.8% from a year earlier. Sales at stores open at least a year increased 3.9% world-wide and 4.8% in the U.S.

Home Depot didn't single out the tonic effects of heavy snowstorms across much of the U.S. during the quarter, but it was expected that increased demand for snow throwers, snow shovels and ice-melting salts gave a boost to the company and smaller rival Lowe's Cos. Lowe's is to post its latest results Wednesday.

Home Depot also put a finer point on the 2011 guidance it gave late last year, and now expects its results across several metrics to meet or beat the high end of its previous forecasts. It now expects 2011 sales to rise 2.5%, at the high end of the previous range, and earnings to increase 9.5% before any buybacks, ahead of the 7% to 9% it had predicted before repurchases. Its cash flow view for the year of $5.7 billion beats the $5.4 billion it had projected, and a predicted improvement of 0.4 percentage point in operating margin is at the top of the former range. Home Depot also boosted its estimated capital expenditures by $50 million to $1.35 billion.

The company's new quarterly dividend is 25 cents a share, up from 23.625 cents. Many U.S. companies hoarded cash during the recession, and are now boosting or starting dividends and buybacks as the need to conserve cash has waned amid perceptions that the domestic economy is healing.

Home Depot's results improved last year as the housing slump eased, helping end a multiyear decline in home-improvement-industry sales.

For the fiscal fourth quarter, Home Depot said its profit rose to $587 million, or 36 cents a share, from $342 million, or 20 cents a share, a year earlier. The year-earlier quarter's earnings, excluding items, totaled 24 cents a share. Revenue increased to $15.12 billion.

Analysts polled by Thomson Reuters most recently expected earnings of 31 cents a share on $14.81 billion in revenue. Gross margin rose to 34.7% from 34.4%, the number of customer transactions climbed 1.4% and the average amount spent per transaction increased 2.6%.

—Matt Jarzemsky and Nathan Becker contributed to this article.
Write to Matt Jarzemsky at matthew.jarzemsky@dowjones.com and Nathan Becker at nathan.becker@dowjones.com

http://online.wsj.com/article/SB1000142 ... 03532.html

Between poeple buying cheap foreclosed properties and fixing them up and other staying in their homes and doing cheaper fix ups such as painting has helped. One big thing I also found is now that many Home Depots no longer have illegals in the parking lots by the front doors harassing people. This has helped alot as well since people don't like being bothered by them. I know the one on in North Miami on Biscayne never allowed it so many people went to that one. The one at the 163rd Street Mall lost business because of all the illegals so now the manager calls police when they set foot on the property and harass customers. The one at Oakwood Park in Hollywood has them on and off but with a police presence illegals have gone elsewhere.

Originally Posted by swatchick

Between poeple buying cheap foreclosed properties and fixing them up and other staying in their homes and doing cheaper fix ups such as painting has helped. One big thing I also found is now that many Home Depots no longer have illegals in the parking lots by the front doors harassing people. This has helped alot as well since people don't like being bothered by them. I know the one on in North Miami on Biscayne never allowed it so many people went to that one. The one at the 163rd Street Mall lost business because of all the illegals so now the manager calls police when they set foot on the property and harass customers. The one at Oakwood Park in Hollywood has them on and off but with a police presence illegals have gone elsewhere.

Good to hear they no longer allow the illegals on their property.
Plus Home Depot uses E-VERIFY now.

15,031 New Businesses Added to our E-Verify Database
NumbersUSA

. . . Walmart and Home Depot topped the list of the most frequently searched companies.
Hopefully, you felt a little more at ease when you found out that both use E-Verify! . . .

http://www.alipac.us/modules.php?name=F ... c&t=194766