Investing.com -- Home Depot (NYSE:HD) has posted a shallower-than-anticipated dip in fourth quarter comparable sales, bringing a close to a year that the DIY retail giant described as one of "moderation."
Retail chains have been hit by a pullback in spending on big-ticket items as cost-conscious consumers grapple with elevated interest rates and high inflation. Home Depot, in particular, has seen shoppers rein in expenditures on major property improvements, opting instead to focus on smaller and cheaper projects.
Comparable sales in the three months ended on Jan. 28 fell by 3.5%, deeper than a drop of 0.3% registered in the same period in the previous year. However, analysts had called for a fall of 3.63%, according to Bloomberg consensus estimates.
Net earnings, meanwhile, came in at $2.8 billion, translating to $2.82 per diluted share.
For the 2023 fiscal period, Home Depot reported net sales of $152.67B, a 3% decrease compared to the prior year, while diluted earnings per share dipped by 9.5% to $15.11. The figures were roughly in line with an annual sales and earnings outlook range that Home Depot narrowed in November.
Analysts at Goldman Sachs warned in a note to clients that Home Depot's potential sales could be further dented "if housing turnover fails to recover or if macro[economic] headwinds weigh on home improvement demand."
Shares in the company were lower in premarket U.S. trading on Tuesday.