Analysts expect Home Depot (HD) to post revenue of $26.39 billion in the first quarter of 2019, a rise of 5.8% from $24.95 billion in the corresponding quarter of 2018. The company’s positive SSSG (same-store sales growth) and its net addition of new stores are likely to drive its revenue during the quarter.
At the end of 2018, Home Depot operated 2,287 stores, which was two stores more than it operated at the end of the first quarter of 2018.
Home Depot is working on improving its delivery and fulfillment options, enhancing the customer experience through its frictionless interconnected shopping experience, improving customer satisfaction, and expanding its product offerings to drive SSSG.
Home Depot’s management announced in June 2018 that it would be investing $1.2 billion over the next five years in strengthening its supply chain and improving its efficiency. The company plans to add 170 distribution facilities during the period, which would enable it to deliver products to 90% of the US population within one day.
In 2018, Home Depot’s online sales increased 24.2% to form 7.9% of its total revenue. To further drive its online sales, the company is focusing on implementing digital advancements to enhance the customer shopping experience. Its newly launched business-to-business website delivers more personalized product offerings to professional customers. The company introduced automated lockers in 1,000 stores at the end of the fourth quarter of 2018. It’s expanding this capability to other stores as well.
Peer comparison and outlook
Home Depot’s management has set revenue guidance of 3.3% for 2019, which accounts for an extra week of operations in 2018. During the same period, the company’s management expects its SSSG to be 5.0%, and it plans to open five new stores. Analysts expect Home Depot to post revenue of $111.52 billion in the year, which represents a year-over-year rise of 3.1%.