Regardless of what others’ opinions of the housing market may be, Home Depot’s (HD) 2010 outlook is getting optimistic.
Q4 U.S. comparable same store sales fell 1.2%, but HD’s 2010 forward guidance in today’s Q4 results includes revenue growth, comparable same store sales growth, margin expansion, and 15.5% earnings per share growth.
In addition they just hiked their dividend and increased their Q4 core earnings 23% year over year and flipped to a reported net profit.
HD’s Q4 Release: Excluding the write-down of the Company’s investment in HD Supply, earnings from continuing operations were $402 million for the fourth quarter of fiscal 2009, an increase of 22.9 per cent from adjusted earnings from continuing operations of $327 million in the fourth quarter of fiscal 2008. On an adjusted basis, earnings per diluted share from continuing operations were $0.24 for the fourth quarter of fiscal 2009, an increase of 26.3 per cent from the same period in 2008.
Fiscal 2009 fourth quarter consolidated net earnings were $342 million, or $0.20 per diluted share, compared with a net loss of $54 million, or a $0.03 loss per diluted share, for the same period in fiscal 2008. Consolidated net earnings include $41 million of earnings from discontinued operations arising from the Company’s working capital settlement agreement with HD Supply.
A few pieces from today’s Q4 conference call (rough quotes):
Goldman Sachs analyst: You spoke about improvement in California and Florida, have you seen a difference in the pace of improvement between those markets and others.
HD: I’d say… only a few markets positive, but if you the kind of pace, maybe a little bit more of a pace of pick up in California and some of the markets in Florida.
Morgan Stanley analyst: Asks a question on HD’s inventory in relation to sales growth.
HD: We will be building inventory in support of the sales guidance we have given you.
Overall the conference call was focused on whether or not Home Depot would be able to properly scale itself back up fast enough with a recovery.
While they’re cautiously optimistic, this isn’t a company that sees any disasters ahead.