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Home Depot reports record sales in Q1, raises earnings guidance

Yahoo Finance Live anchors discuss first-quarter earnings for Home Depot.

Video transcript

- Home Depot seeing its shares take off premarket after posting record sales in the quarter. The company also raised its full year earnings outlook on that solid earnings report. There you're taking a look at some of the latest guidance as well. Total sales growth 3%, margins 15.4% as well.

And particularly here as we think about the guidance that they had raised as well, they're looking for particularly within the total sales growth and comp sales growth that 3% figure. I think going on from here, they're saying fiscal 2022 is off to a strong start and we'll see where this continues to permeate throughout the rest of the year.

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- Two notes for me about Home Depot. First of all, this was the first full earnings period with a new CEO, Ted Decker, at the head of the company. Note number two is that transactions fell. The number of transactions fell, but average [? ticket ?] was up, so people spending more there, whether it's because of higher prices or because they're buying more stuff. But they are going less often or fewer people are going, whatever way you want to slice it. So that was sort of an interesting tidbit in there.

- Yeah, I would say you see the premarket action up 3.7% in the premarket here, our second hottest [? ticker ?] on the Yahoo Finance platform. I thought it was a low quality beat. Gross margins down, operating margins down. I think you saw the earnings coming a little bit better than expected here because they went out and repurchased $2.3 billion in stock.

Another concern here, like we just mentioned, inventory up 32% for Home Depot. And they noted that things slowed down a little bit later on in April. Now their earnings call is going on right now. I'd be very curious to see how Home Depot sales have started here in May. They usually give that metric on the earnings call. If you are on their now, watch out for that metric.