Home Depot’s Earnings Rise on Solid Sales

Home Depot Inc., the nation’s largest home-improvement chain, said Tuesday that its fiscal fourth-quarter net income jumped 9.5% on solid sales growth.

The results met Wall Street expectations, but Home Depot shares slumped amid a broad market sell-off, losing $1.74 to $40.28 on the New York Stock Exchange.

The stock is down 5.8% this year but is still nearly double its five-year low of around $21 reached in early 2003.

For the three months ended Jan. 30, Home Depot said it earned $1.04 billion, or 47 cents a share, compared with a profit of $951 million, or 42 cents, a year earlier.

Analysts surveyed by Thomson First Call had expected earnings of 47 cents a share.

Revenue rose 11% to $16.8 billion.

Same-store sales, a measure of revenue at stores open at least a year, rose 4.6% for the quarter and 5.4% for the year. The increase for the year was the company’s largest since 1999.

For the latest fiscal year, Home Depot earned $5 billion, or $2.26 a share, compared with $4.3 billion, or $1.88, the year before. Revenue rose 13% to $73.1 billion.

Under Chief Executive Bob Nardelli, Home Depot has spent $1 billion to remodel older stores and is adding higher-priced items such as Maytag appliances.

Nardelli is preparing for a slowdown in U.S. sales by adding stores in Canada and Mexico, analysts said.