Home Depot (NYSE:HD), the world's largest home improvement retailer, reported third-quarter results before the markets opened on Tuesday and revealed yet another quarter of healthy sales growth. Surprisingly, Home Depot is maintaining consumer enthusiasm despite a broad reopening of the economy.
Overall, Home Depot reported sales of $36.8 billion in its fiscal third quarter that ended Oct. 31. That's 9.8% higher than the $33.5 billion in sales it reported during the same time last year. The revenue growth was better than analysts on Wall Street were expecting. It seems like every quarter since the COVID-19 pandemic eased, the market experts expect sales growth will slow down significantly for Home Depot, and every quarter Home Depot's sales prove resilient.
Home Depot maintains consumer enthusiasm
CEO Craig Menear talked about consumer enthusiasm for Home Depot in the conference call that followed the Q3 earnings release:
Home improvement demand remains strong. Our customers remained engaged with projects around the home, and we continue to focus on delivering the best experience in retail. As we mentioned last quarter, we continue to see customers taking on larger home improvement projects as evidenced by the continued strength with our Pro customer, which once again outpaced the DIY customer.
Indeed, more extensive projects that require professionals are driving the sustained momentum for Home Depot. One of the things that customers put off during the pandemic was jobs that required people to come into their homes. That's understandable, considering there was a deadly virus in circulation that the world knew little about. Now, with the threat of COVID-19 diminishing as more get vaccinated, people are starting projects that were paused during the early stages of the pandemic.
Home Depot is a market favorite in 2021
The market liked what it saw from Home Depot, and the stock price was up 6.4% by the close of trading on Wednesday. In addition to the impressive revenue growth, Home Depot funneled a good part of those sales to the bottom line. The company reported net earnings of $4.1 billion, up 20% from the same quarter last year. Investors were concerned with profits more than usual this quarter because of widely reported problems with supply chains causing rising costs. Home Depot skillfully managed these challenges and delivered solid earnings growth.
Looking at all of 2021 shows that Home Depot's stock is up more than 48%. That's for a good reason: The home improvement retailer handles nearly every difficulty it faces with skill. Consumers are showing no sign of curtailing spending at Home Depot. And home values keep rising, encouraging folks to invest more in their homes. It's an excellent time to be a Home Depot shareholder.