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Home Depot approves $18B repurchase plan

Home Depot approves $18B repurchase plan

Home Depot soared past expectations for the fourth quarter and authorized the repurchase of $18 billion of its own shares, the company said Tuesday. It also boosted its quarterly dividend by 26%. Shares are up more than 3% in afternoon trading.635603168638179634-generic-appliances-19

Home Depot earned $1.05 a share, or $1.4 billion, in the fourth quarter, up from $1 billion and 73 cents a share in the year-ago quarter. Sales were $19.2 billion, up 8.3% from a year ago and beating analyst expectations for revenue of $18.7 billion. Sales at U.S. stores open at least a year increased 8.9%. “We had a strong finish to the year, as strength across the store, the recovering U.S. housing market and solid execution aided our business in 2014,” said CEO Craig Menear in a statement.

The Atlanta company’s buyback program announced Tuesday replaces a prior authorization. Home Depot has returned more than $53 billion of cash to shareholders through buybacks from 2002 through Feb. 1. The chain plans to complete $18 billion in buybacks by the end of fiscal year 2017. Its dividend will now be 59 cents per share. The dividend will be paid on March 26 to shareholders of record on March 12. Home Depot said it’s the 112th consecutive quarter that it has paid a cash dividend.

For the year, Home Depot earned $4.71 per share on revenue of $83.18 billion. The company now expects 2015 earnings of between $5.11 and $5.17 per share. Revenue is expected to climb about 3.5 to 4.7 percent. Wall Street is looking for full-year earnings of $4.50 per share. The Home Depot had 2,269 retail stores in all 50 states, the District of Columbia, Puerto Rico, U.S. Virgin Islands, Guam, 10 Canadian provinces and Mexico at the fourth quarter’s end. Shares, which rose $4.04 to $116.32 in premarket trading, are already up 14 percent over the past three months in a year in which the company has repeatedly hit new highs.

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