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Home Depot Posts Strong Sales Growth as Pandemic Continues to Fuel Demand

By Matt Grossman 

Home Depot Inc. logged strong sales growth year over year for the November-to-January quarter and raised its dividend, but the company's finance chief said that the trend could flatten this year as the company faces comparisons from its robust 2020 results.

Home Depot's revenue in the latest quarter was $32.26 billion, a 25% increase compared with $25.78 billion in the same three-month period a year earlier. Analysts surveyed by FactSet had forecast revenue of $30.63 billion in the quarter.

Over the full fiscal year, the company's sales rose by 20% to $132.11 billion. That growth follows a broader trend of people spending more on home-related goods during the pandemic, as lockdowns and telecommuting focused attention on the home. The public-health crisis has also shifted consumer behavior in retailers' favor by weighing on services spending, such as on travel, leisure and restaurants.

In the latest quarter, the number of Home Depot customer transactions rose 12.8% to 416.8 million, and the average transaction size grew to $75.69, from $68.29 in 2019's fourth quarter. The company finished the quarter with 2,296 retail stores.

Home Depot Tuesday posted fourth-quarter earnings of $2.86 billion, or $2.65 a share, compared with $2.48 billion, or $2.28 a share, a year earlier. Analysts had been forecasting earnings of $2.61 a share.

Citing uncertainty caused by the pandemic, Home Depot declined to provide formal guidance for its 2021 results. Chief Financial Officer Richard McPhail estimated that if late-2020 demand levels continue into this year, comparable sales -- a figure that corrects for changes in store count -- will be flat or slightly positive in 2021.

Home Depot also raised its quarterly dividend by 10% to $1.65 a share, equal to $6.60 annually.

Write to Matt Grossman at matt.grossman@wsj.com

 

(END) Dow Jones Newswires

February 23, 2021 07:07 ET (12:07 GMT)

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