Bad Weather Plays on Home Depot’s First Quarter Results
Home Depot (NYSE:HD) is the world’s largest retailer of home improvement products and primarily competes with Lowe’s (NYSE:LOW) in this business. Our $36.57 price estimate for Home Depot stock is roughly in line with market price.
Recent Earnings Results
- What’s Next For Home Depot Stock After An Upbeat Q3?
- With The Stock Almost Flat This Year, Will Q2 Results Drive Home Depot’s Stock Higher?
- With The Stock Flat This Year, Will Q1 Results Drive Home Depot Stock Higher?
- Down 8% This Year Will Home Depot Stock Rebound After Its Q3?
- Home Depot Stock To See Little Movement Past Q2
- Why Homebuilder Stocks Are Soaring This Year
Home Depot reported first quarter earnings in mid-May. Net sales for the quarter decreased 0.2% and comparable store sales decreased 0.6% as compared to the same quarter last year. The company remains committed to improving its product offering as well as its customer service, which have helped the company to consolidate its position in the home improvement market over the last few years in the face of increasing competition from Lowe’s. The company expects net sales for fiscal 2011 to increase 2.5% from 2010. [1]
Sales for seasonal goods were in large part affected by bad weather in the first quarter, which ultimate hit net sales. In addition to this, homeowners remained conservative on elaborate renovation work as the housing market remained slow to pick up. However, going into the summer season, we expect demand for seasonal goods to pick up, as well as a broader improvement in macro economic conditions to support sales for plumbing, electrical and kitchen products.
Hardware & Seasonal Product Market Share
Home Depot’s hardware & seasonal product market share has steadied its decline over the past few years. Going forward, we expect the company to further consolidate its number one position in the hardware & seasonal market.
See our full analysis for Home Depot stock here
Notes: