Core Insights - Home Depot Inc (NYSE:HD) reported third-quarter results, surpassing both revenue and earnings estimates, and raised its same-store annual sales and growth forecasts due to strong demand following hurricane season [1] Stock Performance - HD shares increased by 0.2%, trading at $409.39, with an 18.5% gain projected for 2024, marking the highest level in nearly a month and approaching the two-year high of $418.61 reached on October 16 [2] Analyst Sentiment - Among 35 analysts, eight rated HD as a "hold," while the 12-month consensus target price is $414.77, aligning with the current stock price [3] Options Market Activity - Options trading volume is significantly high, at four times the average, with 7,958 calls and 4,412 puts exchanged, indicating interest in the November 420 call [3] - The Schaefer's Volatility Index (SVI) for HD is at 23%, reflecting low volatility expectations, positioned in the low 21st percentile of the past year's readings [4]

Financial Data and Key Metrics Changes - Total sales for Q3 2024 were $40.2 billion, an increase of 6.6% from the same period last year [6][28] - Comparable sales declined by 1.3% year-over-year, with U.S. stores experiencing a negative comp of 1.2% [6][28] - Adjusted diluted earnings per share were $3.78, down from $3.85 in Q3 2023, reflecting a decrease of approximately 2% [6][31] - Gross margin was approximately 33.4%, a decrease of 40 basis points from the previous year [29] - Operating margin for Q3 was 13.5%, compared to 14.3% in Q3 2023 [30] Business Line Data and Key Metrics Changes - Positive comps were seen in power, outdoor garden, building materials, indoor garden, and paint departments, while lumber, plumbing, and hardware were above the company average [21] - Comp transactions decreased by 0.6%, and comp average ticket decreased by 0.8% [21] - Pro sales outpaced DIY customer sales, indicating stronger performance in the professional segment [22] Market Data and Key Metrics Changes - Mexico and Canada posted comps above the company average, with Mexico showing positive comps in the quarter [7] - The impact of hurricanes contributed approximately $200 million in sales, positively affecting total company comps by about 55 basis points for the quarter [29] Company Strategy and Development Direction - The company aims to enhance the interconnected experience and grow pro wallet share through differentiated capabilities and new store openings [9][10] - Investments are being made in supply chain capabilities, including direct fulfillment centers to improve delivery speeds [10] - The focus remains on supporting the growth of the SRS team and leveraging cross-sale opportunities [12] Management's Comments on Operating Environment and Future Outlook - Management acknowledged continued macroeconomic uncertainty and its impact on larger remodeling projects due to higher interest rates [9][68] - The company updated its fiscal 2024 guidance, expecting total sales growth of approximately 4% and adjusted diluted earnings per share to decline by about 1% [33][35] - Management remains optimistic about market share growth despite current challenges [35] Other Important Information - The company opened 5 new stores, bringing the total store count to 2,345 [31] - Merchandise inventories increased to $23.9 billion, up approximately $1.1 billion compared to Q3 2023 [32] - Return on invested capital was approximately 31.5%, down from 38.7% in Q3 2023 [32] Q&A Session Summary Question: Impact of hurricane-related sales - Management noted that hurricane-related sales contributed approximately 55 basis points to Q3 comps, with a focus on generators and cleanup products [41][42] Question: Needs-based vs discretionary projects - Management indicated that needs-based projects are being completed, while larger discretionary projects are being deferred due to economic conditions [44] Question: Progress with SRS and cross-selling - Management reported strong progress with SRS, contributing $2.9 billion in Q3, and highlighted the potential for cross-selling opportunities [51][49] Question: Gross margin pressures - Management explained that the primary impact on gross margin was from the mix due to SRS, with an expected annualized impact of about 70 basis points [54][56] Question: Market share performance - Management expressed confidence in gaining market share, particularly in seasonal categories and building materials [61][63] Question: Future housing market outlook - Management discussed the relationship between interest rates and housing turnover, emphasizing the need for stability in rates to encourage home improvement projects [96][97]

Home Depot NYSE: HD is moving higher on the combined forces of outperformance and an expectation for tailwinds to develop in 2025. Better-than-expected consumer trends, acquisitions, and the pro-business drive outperformance in 2024, leading the company to improve guidance against a backdrop of negative sentiment. Tailwinds will form in 2025 as policy headwinds ease and Trump’s business and consumer-friendly policies spur activity, specifically in the housing market.  Home Depot TodayHDHome Depot$408.88 +0 ...

About this content About William Farrington William kickstarted his career as a researcher and reporter for a global legal publication, covering everything from public law to M&A. Before moving to Proactive Investors, he worked as a reporter for a major fintech company with a focus on cryptocurrency and blockchain technology. Harking from Queensland, Australia, William obtained first-class honours in journalism and media from Birkbeck University before going on to complete an MA in creative and critical wri ...

Group 1 - Home Depot reported quarterly earnings of $3.78 per share, exceeding the Zacks Consensus Estimate of $3.64 per share, but down from $3.81 per share a year ago, representing an earnings surprise of 3.85% [1] - The company achieved revenues of $40.22 billion for the quarter ended October 2024, surpassing the Zacks Consensus Estimate by 2.17% and increasing from $37.71 billion year-over-year [2] - Home Depot has surpassed consensus EPS estimates four times over the last four quarters and topped consensus revenue estimates three times during the same period [2] Group 2 - The stock has gained approximately 17.8% since the beginning of the year, while the S&P 500 has increased by 25.8% [3] - The company's earnings outlook is crucial for investors, as it includes current consensus earnings expectations for upcoming quarters and any recent changes to these expectations [4] - The trend of estimate revisions for Home Depot is currently favorable, leading to a Zacks Rank 2 (Buy) for the stock, indicating expected outperformance in the near future [6] Group 3 - The current consensus EPS estimate for the upcoming quarter is $2.99 on revenues of $38.72 billion, and for the current fiscal year, it is $14.99 on revenues of $157.67 billion [7] - The Building Products - Retail industry, to which Home Depot belongs, is currently ranked in the top 16% of over 250 Zacks industries, suggesting a positive outlook for the sector [8] Group 4 - Lowe's, another company in the same industry, is expected to report quarterly earnings of $2.80 per share, reflecting a year-over-year decline of 8.5%, with revenues anticipated to be $19.92 billion, down 2.7% from the previous year [9]

Group 1 - Home Depot's third-quarter revenue reached $40.22 billion, exceeding analysts' expectations of $39.25 billion and up from $37.71 billion a year ago [1] - Net income for the quarter was $3.65 billion, surpassing the consensus expectation of $3.58 billion but lower than last year's $3.81 billion [1] - The company raised its fiscal 2024 revenue growth projection to approximately 4% year-over-year, an increase from the previous estimate of 2.5% to 3.5% [2] Group 2 - Home Depot adjusted its comparable store sales forecast, now expecting a decline of 2.5% from last year instead of the previously anticipated 3% to 4% decline [2] - The company's shares rose by 1.6% to $415 following the release of the results, building on a 17% increase since the beginning of the year [2] Group 3 - CEO Ted Decker noted that while macroeconomic uncertainty persists, the third-quarter performance exceeded expectations, driven by better engagement in seasonal goods and hurricane-related sales [3] - The impact of the Federal Reserve's interest-rate cut was not specifically addressed in the earnings release, but high interest rates and inflation have led to a decline in "big ticket" purchases [3] Group 4 - Analysts from JPMorgan highlighted the importance of monitoring mortgage rates, suggesting that if rates decrease and housing becomes more affordable, it could positively impact sales for Home Depot and Lowe's [4]

Exhibit 99.1 The Home Depot Announces Third Quarter Fiscal 2024 Results; Updates Fiscal 2024 Guidance ATLANTA, November 12, 2024 -- The Home Depot , the world's largest home improvement retailer, today reported sales of $40.2 billion for the third quarter of fiscal 2024, an increase of 6.6% from the third quarter of fiscal 2023. Comparable sales for the third quarter of fiscal 2024 decreased 1.3%, and comparable sales in the U.S. decreased 1.2%. ® Operating income for the third quarter of fiscal 2024 was $5 ...

ATLANTA, Nov. 12, 2024 /PRNewswire/ -- The Home Depot®, the world's largest home improvement retailer, today reported sales of $40.2 billion for the third quarter of fiscal 2024, an increase of 6.6% from the third quarter of fiscal 2023. Comparable sales for the third quarter of fiscal 2024 decreased 1.3%, and comparable sales in the U.S. decreased 1.2%.Operating income for the third quarter of fiscal 2024 was $5.4 billion and operating margin was 13.5%, compared with operating income of $5.4 billion and an ...

Core Viewpoint - Home Depot is expected to report quarterly earnings with earnings per share projected at $3.64 and revenue at $39.32 billion, amidst a sales slump due to higher mortgage and interest rates affecting homeowners' project decisions [1] Group 1: Earnings Expectations - Earnings per share is anticipated to be $3.64 [1] - Revenue is projected to reach $39.32 billion [1] Group 2: Market Context - Home Depot is experiencing a sales slump as higher mortgage and interest rates have led homeowners to delay major projects [1] - The company's stock has increased nearly 18% this year, in contrast to the S&P 500's nearly 26% gains [1]

| --- | |-----------------------------------------------------------------------------------------------------------------------------| | Key Takeaways | | The Home Depot, Walmart and Target stocks appear likely to beat third-quarter earnings estimates. | | HD, WMT and TGT stock look likely to have their prices driven up in the near term. | | Register now to see our 7 Best Stocks for the Next 30 Days report - free today! | We are in the last leg of the third-quarter 2024 earnings season. So far earnings res ...