With so many retailers faltering, it’s hard not to get dizzy looking at the latest results from The Home Depot. Using words like “stupendous” and “outstanding,” industry analysts are singing the Atlanta-based DIY chain’s praises.
The Home Depot says sales soared 23.4% to a record-breaking $38.1 billion in the second quarter of its fiscal year, with comparable sales in the U.S. skyrocketing 25%. Online sales rose about 100%, and consumers picked up roughly 60% of all online orders in stores.
And even with the chain spending an additional $1.3 billion in enhanced pay and benefits year-to-date, net earnings also rose nearly 25%, reaching $4.33 billion, compared to $3.48 billion in the comparable period last year.
The results are a testimony to just how serious consumers got about nesting while sheltering at home, says Seth Basham, an analyst who follows Home Depot for Wedbush Securities. In his report on the results, he calls the performance “stupendous.” And he writes that the company’s ability “to drive $7.2 billion in additional sales with a 12% gain transaction growth is truly impressive and reflects adept management.”
And while Basham expects sales growth has likely slowed since peaking in June, it “remains robust and should remain well above pre-pandemic levels through at least the back half of the year, as homeowners continue to invest in their homes where they continue to spend a disproportionate amount of their time.”
Indeed, data from GlobalData Retail finds 73% of people undertook at least one project in the home or garden, compared to 56% in the same period of the prior year.
GlobalData Retail says most projects have focused on three areas. First, many are aimed at making home more practical for working and learning there, including projects like shelving and lighting. Next, they are trying to make living spaces more comfortable and cozier. And finally, many are tackling large-scale projects, like building decks and redoing kitchens and bathrooms.
Brian Nagel, an analyst who follows Home Depot for Oppenheimer & Co., calls its sales report “outstanding,” and show just how well it is capitalizing on COVID-19 related disruptions in consumer spending.
“For a long while, we have highlighted Home Depot as one of the best-run retailers in the U.S., if not the world,” he writes. He expects it to do well “through and beyond the pandemic.”