Shares of the home improvement retailer, The Home Depot (NYSE: HD) were down in pre-market trading on Tuesday at the time of writing after the company slashed its sales outlook for FY23.
HD now expects sales and comparable sales to both drop by 2% to 5% year-over-year in FY23 while diluted earnings-per-share is forecasted to decline between 7% and 13% year-over-year.
Richard McPhail, EVP and CFO stated, “Given the negative impact to first quarter sales from lumber deflation and weather, further softening of demand relative to our expectations, and continued uncertainty regarding consumer demand, we are updating our guidance to reflect a range of potential outcomes.”
In the first quarter, the company announced diluted earnings of $3.82 per share, a drop of 6.6% year-over-year while analysts were expecting earnings of $3.81 per share.
The company posted sales of $37.3 billion in the first quarter, a decline of 4.2% year-over-year, and comparable sales also fell by 4.5% in Q1.
Analysts are cautiously optimistic about HD stock with a Moderate Buy consensus rating based on 14 Buys and nine Holds.
