BY: MARSHALL BARTLETT
Senior Vice President / Portfolio Manager
This morning, Home Depot announced quarterly earnings of 3.17 per share, higher than estimates, and comparable sales were up 3.0%. However, revenue of $30.8 billion in the quarter was slightly below estimates, driven primarily by a fall in lumber prices. While maintaining their earnings guidance for the year, the company adjusted their sales outlook a bit lower citing the lower lumber prices and potential impacts to the US consumer arising from the recently announced tariffs. These results highlight the strength of the US consumer, as comparable sales are increasing, and the uncertainty companies are facing with tariffs and ongoing discussions on trade. Later this week, Jerome Powell of the Federal Reserve will speak in Jackson Hole, where he could provide additional guidance on the mid-cycle lowering of interest rates given uncertainties with tariff’s and the global economy. In all, bond yields are slightly lower and equity futures, including Home Depot, are higher this morning heading into the market open.
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