On Tuesday Home Depot reported that its sales as well as net income was up for the first quarter despite a slower than normal start for the spring selling season thanks to a harsh winter.
However, the results did not meet Wall Street expectations and shares dropped by 1.4% during early morning pre-market trading.
Sales at the retailer that specializes in home improvement were up 2.9% to reach $19.69 billion during the quarter that ended on May 4. Sales in the same quarter one year ago were $19.12 billion.
Wall Street analysts were expecting sales to be just over $19.97 billion.
U.S. Stores that were opened 13 months or longer saw sales increase by 3.3%.
For the quarter, Home Depot’s earnings were $1.38 billion equal to $1.00 a share compared to last year during the same period of $1.23 billion equal to 83 cents a share.
Excluding benefits from the sale of part of equity ownership in the company HD Supply Holdings, Home Depot’s earnings were 96 cents a share, while analysts had expected them to reach 99 cents.
Frank Blake Home Depot’s CEO and chairman said the year’s first quarter had been impacted due to the spring season starting slow because of an extended winter. Nevertheless, said Blake, the company had solid results in the markets that were not impacted by weather and sales are expected to grow in line with the company guidance previously released.
Home Depot raised its earnings forecast for the full year to $4.42 a share. Prior guidance called for earnings per share to be $4.38. The chain also reaffirmed its revenue outlook for 2014 that it said would increase by approximately 4.8%.
Home Depot as well as Lowe’s Cos its rival, which will report its results for the quarter on Wednesday, have benefited in general from a housing market that has improved. Although there had been concerns that the severe winter that had gripped the majority of the country would make property and homeowners hold off on their improvements and repairs.
Cold weather lingered much longer than it normally does, weighing on the company sales, said Home Depot.