Analysts are expecting Home Depot (HD) to post revenue of $21.8 billion in 4Q16, which represents a rise of 3.7% from $21.0 billion in 4Q15.
Analysts are expecting positive same-store sales growth (or SSSG), unit growth, and a rise in online sales to drive Home Depot’s revenue in 4Q16.
To enhance customer experience, Home Depot has implemented the customer order management (or COM) system and buy online deliver from store (or BODFS) system in all its US stores. The company is also investing in its Project Sync, a Supply Chain Synchronization project, to transform its supply chain by optimizing its networks. These initiatives are expected to reduce down time, thus contributing to a possible rise in 4Q16 SSSG. The company is also focusing on product innovations to drive sales.
Let’s look now at the macro environment. The rise in the housing price index, a lower unemployment rate, and rising wages are expected to contribute to Home Depot’s 4Q16 SSSG. Management expects SSSG to be 4.7% and revenue growth to be 6.3% for 2016.
For the next four quarters, analysts are expecting Home Depot to post revenue of $97.1 billion. That would be a rise of 4.0% from $93.4 billion in the corresponding quarters of the previous year.
Next, let’s look at Home Depot’s estimated 4Q16 margins.