Investing.com - Home Depot Inc (NYSE:HD), the world’s largest home improvement chain, posted better-than-expected fourth-quarter earnings results on Tuesday, with earnings per share (eps) of $1.44 compared to analysts’ expectation of $1.33.
Same store sales surged 5.8%, surpassing estimates for a 3.5% increase. In the U.S., a key market for Home Depot, same-store sales rose 6.2%, as demand for building materials and appliances from contractors and consumers, respectively, soared over recent months.
The home-improvement sector has benefited from a boom in home remodelling projects, supported by a continued rise in the value homes amid a strong U.S. housing recovery.
The national median existing-home price in the fourth quarter was $235,000, up 5.7% from a year ago, according to the National Association of Retailers (NAR) while the home remodelling index reached a new all-time high of 106.1 during the same period, noted Metrostudy.
Fresh off the heels of the stronger-than-expected quarterly report, Home Depot hiked its quarterly dividend by 20% and introduced a $500 billion share repurchase program.
Despite the optimism in the retail sector, there is growing concern over President Trump’s border-adjusted tax proposal. The border-adjustment tax, threatens to weigh on bottom-line growth of many large retailers, as it proposes a tax on companies that import goods in the U.S.
Home Depot’s shares slumped at the start of the U.S session but quickly recovered to trade at $145.02 up 1.4%.