Home Depot on Wednesday raised its fiscal 2010 earnings guidance for the second time in two months as Americans slowly begin to take on more home-improvement projects.
CFO Carol Tome said in an interview that "November was a terrific selling month for us," with better-than-expected revenue in categories store-wide.
Home improvement retailers have faced weak revenue as consumers hold back on major renovations because of the uncertain housing market and high unemployment. But there are positive signs: Last week, an index of sales agreements compiled by the National Association of Realtors showed a third straight monthly increase in signed contracts for home purchases.
The No. 1 U.S. home-improvement retailer now expects net income from continuing operations to be $1.97 per share. That's up from prior guidance of $1.94 per share. Analysts polled by Thomson Reuters, on average, also predict $1.94 per share.
The company now expects revenue to rise 2.3 percent, up from the 2.2 percent rise expected previously, implying revenue of $67.7 billion. Analysts expect revenue of $67.59 billion.
For 2011, Home Depot predicts earning per share from continuing operations before share repurchases to rise 7 percent to 9 percent, or up 11 percent to 13 percent after share repurchases. The company, based in Atlanta, expects revenue to rise 2 percent to 2.5 percent.
Revenue in stores open at least a year is expected to rise in the low single digits. The figure is considered a key measure of a retailer's financial health because it excludes stores that open and close during the year.
Home Depot plans to open 10 new stores in 2011. It plans $1.3 billion in capital expenditures and about $2.5 billion on share repurchases.
As the company approaches its peak selling season in the spring, Tome said, Home Depot plans on hiring more staff, but the company didn't give details.
Home Depot operates 2,246 stores in the U.S., Mexico and Canada. Get real-time quotes for Home Depot here.