Home Depot Earnings Exceed Estimates As Home Deliveries Continue to Soar

Earnings analysis of Home Depot for Q3 2020

Source: Dreamstime

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On Tuesday, the popular U.S. home supply chain reported that its Q3 earnings for 2020 greatly exceeded expectations, with sales rising 24% compared to last year.

In line with the good news, Home Depot also announced that a portion of its temporary employee salary boosts that were implemented due to COVID-19 will become permanent, resulting in $1 billion additional expenses each year. 

Here are the main financial highlights from Home Depot’s Q3 2020 earnings release:

 

Total revenue: $33.54 billion versus expectations for $32.04 billion.

Net income: $3.43 billion (24% increase year-over-year).

Earnings per share: $3.18 versus expectations for $3.06.

Sales: total sales are up 24% year-over-year, while digital sales are up 80% year-over-year. Sales of big-ticket items, like riding mowers and outdoor power equipment, attracted a great deal of buyer interest throughout the quarter, with the company even boasting that it had hosted its “most successful Halloween event”.

Planned acquisitions: on Monday, Home Depot announced that it would pay $8 billion to acquire HD Supply – one of North America’s largest industrial product distributors.

 

Earnings guidance for fiscal 2020

While Home Depot did not provide a full-year outlook due to the pandemic, Brian Nagel, senior analyst at Oppenheimer, told CNBC’s “Squawk Box” that the company’s pandemic-fueled gains won’t be sustainable in the long run.

In addition, Chief Operating Officer Ted Decker noted that the continued increase in demand is putting pressure on the supply chains and forces the company to constantly introduce new products, adjust assortments and “in some cases, reduce the number of [stock keeping units] in certain categories to focus on the highest demand products.”


Upcoming reports

See the full list of upcoming earnings reports for 23 – 27 November in the tables below.

Monday, November 23rd 2020

Country of originCompany nameFiscal period
USAAgilent Technologies Inc
Q4 2020
USAAmbarella Inc
Q3 2021
USAUrban Outfitters Inc
Q3 2021
United KingdomTempleton Emerging Markets Investment Trust PLC
Half Year 2020
United KingdomEdinburgh Investment Trust PLC
Half Year 2020
United KingdomTalktalk Telecom Group PLC
Interim report for 2021
United KingdomDaily Mail and General Trust P L C
Full Year 2020

Tuesday, November 24th 2020

Country of originCompany nameFiscal period
USAGap Inc
Q3 2020
USAHP Inc
Q4 2020
USAAutodesk Inc
Q3 2021
USAVMware Inc
Q3 2021
USADollar Tree Inc
Q3 2020
USAProgressive Corp
Report for October 2020
USAAnalog Devices Inc
Q4 2020
USABest Buy Co Inc
Q3 2021
IrelandMedtronic PLC
Q2 2021
United KingdomPennon Group PLC
Half Year 2021
United KingdomShaftesbury PLC
Full Year 2020
United KingdomCompass Group PLC
Full Year 2020

Wednesday, November 25th 2020

Country of originCompany nameFiscal period
USADeere & Co
Q4 2020
United KingdomUnited Utilities Group PLC
Half Year 2021
United KingdomBabcock International Group PLC
Half Year 2021
USADell Technologies Inc
Q3 2021

Thursday, November 26th 2020

Country of originCompany nameFiscal period
United KingdomBritvic PLC
Full Year 2020
United KingdomSevern Trent PLC
Half Year 2021

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