Home Depot’s stock surges after profit, sales rise well above expectations

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Shares of Home Depot Inc. surged 2.4% into record territory in premarket trading Tuesday, after the retailer reported a fiscal second-quarter profit that rose above expectations, as sales jumped 23.4% to a record to beat forecasts by a wide margin. Net income for the quarter to Aug. 2 grew to $4.33 billion, or $4.02 a share, from $3.48 billion, or $3.17 a share, in the year-ago period. The FactSet consensus for earnings per share was $3.68. Sales climbed to $38.05 billion from $30.84 billion, well above the FactSet consensus of $34.53 billion. Same-store sales increased 23.4%, beating the FactSet consensus of 12.2%, while U.S. same-store sales growth of 25% was more than double expectations of a 12.0% rise. “”The investments we have made across the business have significantly increased our agility, allowing us to respond quickly to changes while continuing to promote a safe operating environment,” said Chief Executive Craig Menear. “In the second quarter, the Company invested approximately $480 million in additional benefits for associates, including weekly bonuses for hourly associates in stores and distribution centers.” The stock has climbed 32.0% year to date through Monday, while the SPDR S&P Retail ETF has advanced 14.6% and the Dow Jones Industrial Average has slipped 2.4%.
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