Home Depot just showed Wall Street how it can buck the latest negative trends in retail, with both profit and same-store sales handily outpacing Wall Street estimates.
The retailer also raised its fiscal 2017 profit outlook. Shares of the stock traded were up 1.5 percent following the report.
Here's what the company reported vs. what the Street was expecting:
- Earnings per share: $1.67 vs. forecast of $1.62, according to Thomson Reuters consensus estimates.
- Revenue: $23.89 billion vs. estimate of $23.74 billion, Thomson Reuters said.
- Same-store sales: 5.5 percent growth globally vs. forecast of 4 percent growth, according to FactSet estimates.
Home Depot said U.S. comparable sales — a metric monitored closely by the Street for retail stocks — climbed a whopping 6 percent during the first quarter, blowing past a 4.3 percent estimate compiled by analysts who cover the company.
Home Depot's net income climbed to $2.01 billion, or $1.67 per share, in the first quarter, from $1.80 billion, or $1.44 per share, a year ago.
"We were pleased with our results as they reflected broad-based growth across our interconnected platform and all geographies," Craig Menear, Home Depot CEO, wrote in a statement.
One point of strength for Home Depot was the gains it made in selling pricier items. The retailer said its average shopper's ticket rose 3.9 percent from a year ago, while its sales per square foot of store space gained 4.6 percent during that period.
Sales of big-ticket items, which are priced above $900, rose 15.8 percent during the quarter. Those items generally make up a fifth of Home Depot's sales.
Home improvement companies like Home Depot and its rival Lowe's have historically performed well as housing data improve. As home values rise, for example, shoppers are encouraged to invest more in their properties.
For 2017, Atlanta-based Home Depot reaffirmed Tuesday that it expects both revenue and comparable sales to rise 4.6 percent — a rare forecast for growth amid many retailers' expectations for negative same-store sales this year.
The profit forecast was increased, with Home Depot now expecting earnings per share, after anticipated share repurchases, to rise about 11 percent year-over-year to $7.15.
"What I expect is [Home Depot] will continue beating throughout the year," Oppenheimer analyst Brian Nagel told CNBC on Tuesday.
By keeping its 2017 same-store sales forecast at 4.6 percent, "this is Home Depot being conservative," Nagel added, saying he doesn't expect any economic data to derail the company anytime soon.
Neil Saunders, managing director of GlobalData Retail, also said he doesn't see any signs that the housing market will weaken and hurt the economic tailwind Home Depot has been enjoying.
"While inevitably helpful, it would be unfair to say that Home Depot's performance is solely down to underlying economic factors," Saunders said in an email. "In our view, the company has worked hard to stimulate growth and defend its market share."
Saunders cited Home Depot's Spring Black Friday sales event and its new Patio Mix & Match offer, which allows shoppers to customize their patio sets, as examples.
As of Tuesday's close, shares of Home Depot have climbed more than 18 percent over the past 12 months and are up about 17 percent for the year-to-date period.