Is Home Depot stock a good buy now that shares dipped after the retailer reported earnings Tuesday? Our expert weighed in on FOX Business this afternoon...
- Is Home Depot Stock a Good Buy? (NYSE: HD)
- Stock Market Futures Down on Underwhelming AAPL Presentation and Interest Rate Fears
- We Want to Hear From You: Are Retailers' Stimulus Measures Persuading You to Spend?
- Bulls Vs. Bears: Who's Winning Wall Street's Biggest Battle?
- Home Depot and Lowe's Laying the Foundation for Recovery with Little Help From the Housing Market
- Only the Strongest Retailers Will Survive in 2010 as U.S. Consumers Continue to Battle Back
- Home Depot's Numbers Show Housing's Still in the Basement
Stock market today, Sept. 10, 2014: Stock market futures were down this morning after markets took a nosedive in the final hour of trading yesterday (Tuesday). The slide followed a broad selloff of tech giant Apple Inc. (Nasdaq: AAPL) and investors heightened cautions over a possible interest rate increase by the Federal Reserve sooner rather than later.
Through such tactics as loan programs, credit card rebates and gift card giveaways, top retail chains are rolling out promotional strategies, hoping to break consumers out of their anti-spending doldrums.
"A lot of the government programs have come to an end," David Bassuk, an expert from financial consultancy AlixPartners, told The New York Times. "So retailers are taking it upon themselves to do everything they can to get the consumer to spend, even opening up their wallets to give money back to the consumer."
Sam's Club is taking an unusual approach: It's offering loans of $5,000 to $25,000 to its members, backed by the Small Business Administration. Superior Financial Group is managing the loans and will give Sam's members a $100 discount on the loan application fee and lower interest rates.
But despite what the bears would have you believe, several strong companies have shrugged such data aside and broken through to new highs. In fact, long-term, we continue to see evidence that a robust business-led recovery is underway.
The Home Depot Inc. (NYSE: HD) and Lowe's Cos. Inc. (NYSE: LOW) both topped analysts estimates in the fourth-quarter, as more Americans undertook "do it yourself" projects and edged back into purchases of big-ticket items.
Home Depot's total revenue for the quarter ended Jan. 31 fell to $14.57 billion, but net income swung to a gain $342 million, or 20 cents a share, from a year-earlier loss of loss of $54 million, or 3 cents a share.
However, 2010 will be difficult for retailers as they contend with high unemployment, tight credit, and aggressive competition.
Retail sales gained 3.6% year-on-year from Nov. 1 through Dec. 24, SpendingPulse, a unit of MasterCard Advisors (NYSE: MA) said earlier this week. But an extra day between Thanksgiving and Christmas this year may have skewed the data anywhere from 2% to 4%, SpendingPulse said. Sales in the same period last year declined 2.3% as consumers reeled from the financial meltdown that occurred in the fall.
"The latest holiday shopping season wasn't a rip-roaring success, but at least it met or slightly exceeded expectations," John Lonski, chief economist of Moody's Capital Markets Research Group (NYSE: MCO) told The Associated Press. "Consumer spending is indeed in a recovery mode, which brightens prospects for 2010."
Home Depot reported sales of $16.36 billion for the fiscal quarter ended Nov. 1, down almost 8% from $17.78 billion in the comparable period last fiscal year. That resulted in an 8.9% drop in net income, which fell to $689 million, or 41 cents a share - down from the year-ago figures of $756 million, or 45 cents a share. Same-store sales were down 6.9% corporate-wide, and 7.1% in the United States.