Home Depot turned in mixed fiscal fourth-quarter results Tuesday before the open and gave weak guidance. HD stock tumbled along with rival Lowe's.
Home Depot Earnings
The home improvement retailer posted earnings per share of $3.30 vs. FactSet consensus for $3.28. It reported revenue of $35.83 billion vs. $35.97 billion expected.
Year over year, Home Depot earnings rose 2.8% and revenue edged up 0.3%. That marked the second consecutive quarter of slowing profit and sales growth.
In Tuesday's earnings release, Home Depot CEO Ted Decker touted the company's growth while navigating "persistent inflation, ongoing global supply chain disruptions, and a tight labor market."
The company will spend an additional $1 billion to compensate hourly workers, which is expected to weigh on margins.
For fiscal 2023, the Dow Jones retail giant expects EPS will decline in the mid-single digits. It's guiding for flat sales and comparable-sales growth.
Wall Street had forecast Home Depot earnings per share to be roughly flat vs. 2022, while sales were seen edging up 0.4%.
HD Stock, LOW Stock
Shares shed 7.1% to 295.50 in big volume on the stock market today. HD stock tumbled below its 200-day line after undercutting the 50-day moving average last week.
Rival Lowe's, which reports next week, lost 5.1% Tuesday.
Home Depot's board approved a 10% dividend hike, Tuesday's release added. That takes the annual dividend to $8.36 per share, yielding 2.63% based on Friday's closing price.
Home improvement retailers were Covid pandemic winners. More recently, they found favor as defensive plays amid inflation and global recession fears.
They had rallied in recent months among with other housing-related plays as mortgage rates came off highs. But borrowing costs have been trading higher again.
