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Shares of the retailer climbed 3.4 percent to $185.45 in
premarket trading, after the retailer also raised its forecast
for annual sales and profit ahead of the holiday shopping
season.
Uncertainty over future home prices and a shortage of properties
for sale have spurred homeowners and contractors to remodel
homes instead of buying or building houses, spurring demand for
Home Depot products.
"We believe (the results are) a testament to the overall
strength of demand in the home improvement market," said Chief
Executive Officer Craig Menear.
In August, Menear said homeowners were spending more as they
viewed their homes as an investment rather than an expense.
Home price gains slowed further in August, a new sign that
higher mortgage rates were weighing on housing demand.
Sales at U.S. Home Depot stores open for more than a year surged
5.4 percent during the third quarter ended Oct. 28, above
analysts' expectations of a 4.38 percent increase, according to
IBES data from Refinitiv.
The number of customer transactions at Home Depot stores rose
1.4 percent, while the average check increased 3.6 percent.
The Atlanta-based retailer now expects sales to rise 7.2 percent
in the year ending January, compared with an earlier forecast of
7 percent growth. It raised its earnings forecast to $9.75 per
share from $9.42 previously.
Home Depot's third-quarter net earnings rose to $2.87 billion,
or $2.51 per share, from $2.17 billion, or $1.84 per share, a
year earlier. That beat analysts' average estimate of $2.26 per
share.
Net sales overall climbed 5.1 percent to $26.30 billion, edging
past analysts' expectations for $26.26 billion.
(Reporting by Aishwarya Venugopal in Bengaluru and Nandita Bose
in New York; Editing by Sai Sachin Ravikumar and Bernadette
Baum)
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