By MICHELLE CHAPMAN AP Business Writer
Home Depot reported a better-than-expected fourth quarter with strong comparable-store sales. The home improvement retailer also boosted its quarterly dividend by 10%.
Shares rose 3% in premarket trading Tuesday.
“Home Depot’s numbers are important as they, perhaps more than those of other retailers, reflect underlying consumer confidence: the housing market and big-ticket spending are leading indicators of the broader economy,” Neil Saunders, managing director of GlobalData Retail, said in a statement.
A report released Tuesday, showed that U.S. home prices rose at a faster pace in December, with mortgage rates remaining low and a falling supply of available properties. The S&P CoreLogic Case-Shiller 20-city home price index climbed 2.9% in December from a year earlier after posting a 2.5% gain in November.
The latest figures on consumer confidence will be released Tuesday by the Conference Board, a non-profit business research group.
For the three months ended Feb. 2, Home Depot Inc. earned $2.48 billion, or $2.28 per share. That’s better than the per-share earnings of $2.11 projected by industry analysts, according to a survey by Zacks Investment Research. A year earlier the Atlanta company earned $2.34 billion, or $2.09 per share.
Revenue declined to $25.78 billion from $26.49 billion. The year-ago period included an extra week. The results still topped Wall Street’s forecast of $25.75 billion.
Sales at stores open at least a year rose 5.2%, which was also better than analysts had expected. Those sales climbed 5.3% in the U.S.
Rival Lowe’s Cos., which will report its financial results on Wednesday, saw its shares climb 2.1% before the market open.
Home Depot anticipates earnings this year of about $10.45 per share, far better than analysts projections of $10.08. It expects revenue growth of approximately 3.5% to 4%.