In the year of the lockdown, the housing market was among the very few bright points for the U.S. economy and Home Depot became its provider, racking up revenue of an astounding $132 billion for 2020.
In the final quarter of the year, revenue rose much higher, rising 25 percent to $32.26 billion. According to a survey of analysts by Zacks Investment Research, that is up from $25.78 billion in the same timeframe last year and surpassed even the lofty predictions for $30.66 billion on Wall Street.
With millions operating from home and attending school online, home improvement stores became a beehive throughout the pandemic. Many families believed that the response in 2020 was larger homes, or at least different homes, sending prices sky high.
On Tuesday, compared to the same month last year, the S&P CoreLogic Case-Shiller 20-city home price index reported a 10.1 percent spike in December. Which exceeded the 9.2 percent leap in the previous month, and almost seven years ago in all other months.
While Home Depot was not alone in meeting the demand for hammers, paint or appliances that go with a housing boom, the sheer volume of items it sold this year was overwhelming.
Neil Saunders, GlobalData’s managing director, estimated that the equivalent of every person in the United States spent $402 at Home Depot in 2020 in an effort to bring that volume into perspective.
“It is easy to look at Home Depot’s numbers and chalk up its success to the pandemic,” Saunders said Tuesday. “However, sustaining three quarters of growth above 20% is extremely difficult in terms of the pressure it puts on the whole operation from supply chains to stores.”
Global shop sales open at least one year, a key measure of the health of a retailer, rose by 24.5 percent, and by 25 percent if only U.S. stores are counted.
For the three months ended Jan. 31, Home Depot Inc. received $2.86 billion, or $2.65 per diluted share, compared with $2.48 billion, or $2.28 per diluted share, a year ago.
Earnings were $2.74 per share, adjusted for expenses related to mergers and acquisitions. That handily beat the $2.63 Wall Street was calling for per share.
On Tuesday, the Atlanta business said it failed to provide annual guidance for the year, citing the uncertainty of the pandemic. Given the huge numbers Home Depot put up in 2020, that dispirited investors, and shares fell at the opening bell by more than 3 percent.
However, the nation’s largest home improvement chain raised its quarterly dividend 10 percent, to $1.65 per share, in a show of trust.