What happened

Shares of At Home Group Inc. (NYSE:HOME) moved higher today after the home-goods retailer blew past analyst estimates in its fourth-quarter earnings report, riding a rising tide in retail, especially as growth in home products has been strong. As a result, the stock closed up 19.2%.

A decorative bed shown inside a bedroom

Image source: At Home.

So what

The so-called home decor superstore said comparable-store sales increased 5.7% in the key holiday quarter, propelling a 25.2% jump in revenue to $293.7 million, as the company added 26 stores in the last year. That figure topped estimates at $286.2 million.

Gross margin increased 150 basis points to 33.8%, as higher sales helped leverage store occupancy costs. Adjusted earnings per share increased 79% to $0.50, due in part to a lower tax rate, which beat estimates of $0.35.

CEO Lee Bird noted that the quarter was the 15th in a row with sales growth of 20% or more, and 16th in a row with growth in comparable sales. He said: "Our merchandising and marketing initiatives, along with the broad appeal of our value price points, continue to resonate with customers. In addition to our top line performance, we invested in our top priorities of marketing and new store growth while driving consistent gross margins and meaningful adjusted operating margin expansion."

Now what

At Home also offered strong guidance for the current fiscal year: It sees revenue growing 21% to 22%, to between $1.154 billion and $1.161 billion, and expects adjusted net income to increase 30% to 36%, with earnings per share of $1.18 to $1.24. Both forecasts were ahead of the analyst consensus for revenue of $1.14 billion and earnings per share of $1.15.

The company also expects its effective tax rate to fall to 20% due to recent tax reform law. Considering the strong secular growth, and the benefits from the new tax law, it's no surprise to see At Home shares surging today.

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