The world's largest home improvement retailer boosted quarterly sales and profit at a time of weak earnings at other retailers. Fred Katayama reports.
More customers spent more money at Home Depot to spruce up their homes. That boosted quarterly sales and profit beyond analysts expectations. The earlier arrival of warmer spring weather helped the company get to - in the words of CEO Craig Menear - "a stronger than expected start to the year." And analysts say it was shielded from the West Coast port disruptions that hurt other retailers because Home Depot sources many of its goods domestically. The world's largest home improvement retailer saw comparable store sales in the U.S. rise more than 7 percent. Piper Jaffray senior analyst Peter Keith thinks consumers inspired by rising home prices are spending more of their money at home improvement stores. He said, "Based on our ongoing home improvement survey work, we expect this positive wallet share to continue through at least 2015 and likely through 2016, which in turn should allow Home Depot to continue to post healthy comp and per-share earnings upside." The year's going so well that the company hiked its sales and profit forecasts for 2015. But that doesn't account for an accrual of losses related to the massive data breach that struck the company last year. And it's still unable to estimate the costs. Home Depot shares rose in early trading. They've been on a tear this year, outperforming the Dow and its archrival, Lowe's.