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Home Depot (HD) Q4 2020 Results

People wear face masks outside the Home Depot in the Flatiron neighborhood as the city continues with Phase 4 of the reopening following restrictions imposed to slow the spread of the coronavirus on August 8, 2020 in New York City.

Noam Galai | Getty Images

Home Depot is set to release its fourth quarter financial results before the bell Tuesday.

Here’s what Wall Street expects, based on Refinitiv consensus estimates:

  • Earnings per share: $ 2.62, expected
  • Revenue: $ 30.73 billion, expected

The retailer’s results will indicate whether pandemic trends and the real estate market continue to drive home improvement sales. The company is also gearing up for spring, which is usually its busiest season.

During the pandemic, Americans had a “nesting” mentality and their homes served a wide range of purposes, from the remote classroom and the office to the gym. Consumers have undertook DIY projects and hired professionals for home renovation. Some have moved from densely populated cities and bought homes in suburban or rural areasbecause they are looking for more space or taking advantage of low interest rates.

At Home Depot, it drove business. Its comparable store sales in the United States increased by about 25% in the second and third quarters, as consumers visited more stores and the retailer’s website and spent more money. Its digital sales were up 80% year-over-year in the third quarter, with customers picking up most of those online orders in stores.

Analysts expect Home Depot’s same-store sales to grow 19.2% in the fourth quarter, a big gain but a slower pace than the peak of the pandemic, according to a StreetAccount survey.

Home Depot did not provide an outlook for the year. He faces tough comparisons over the next few quarters due to the significant numbers he presented during the pandemic. It may also need to work harder on wallet sharing, as consumers get vaccinated against Covid-19 and spend weekends at dinner or on vacation instead of painting or doing repair projects. However, its sales could be supported by a rebound in the activities of professionals in the home, with consumers feeling more comfortable inviting people to their homes and paying for projects they have postponed or not. could not do it alone.

About 45% of Home Depot’s sales come from professionals, such as plumbers, electricians, and contractors, with the remainder coming from DIY customers. It’s a higher percentage of the rival Lowe’s, which makes 20% to 25% of its sales to pros. The Home Depot also has larger home professionals as clients.

Home Depot could capitalize on this advantage with HD Supply. He acquired the former unit of the company and a large distributor of industrial products in November in a deal valued at $ 8 billion.

As of Monday’s close, Home Depot shares are up more than 12% from a year ago. The market value of the company is $ 296.98 billion.

This story is developing and will be updated.

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