The housing market’s recovery in the U.S. has helped home improvement retailer Home Depot beat the projections of analysts for quarterly revenue and profit.
The results prompted the largest home improvement chain in the world to increase its fiscal year outlook.
Home Depot shares jumped 3.3% in premarket trading on Tuesday to $77.70.
The financial results come only weeks after government data showed that home prices in the U.S. had increased in May. This gives additional evidence that the housing market is healing after a number of years of weakness.
The housing market bubble in the nation was at the core of the financial crisis from 2007 to 2009.
While in the depths of the financial crisis, sales for Home Depot at established stories dropped over 20% in markets like California and Florida
Over recent quarters, there has been a rebound in housing in California and Florida. In other states where the retailer has a large presence like Nevada and Arizona, the rebound has also started to show.
Net earnings for the fiscal second quarter that ended August 4, increased to $1.8 billion or the equivalent of $1.24 per share. Analysts had estimated the company would earn $1.21 per share.
Sales for the same period were up 9.5% to end the quarter at $22.5 billion, which topped the estimates of analysts who predicted $21.8 billion.
Thus far, for 2013, the company has increased its forecast for earnings to $3.60 per share from its original $3.52. Home Depot officials said they expect sales to increase approximately 4.5%, up from the 2.8% they originally projected.
Home Depot was also helped by its internal efforts of improving the customer experience and service to attract more shoppers. The home improvement retailer also tailored its marketing efforts to local areas, shifted workers to help customers directly and centralized the many distribution centers.
That helped Home Depot take market share from its biggest rival Lowe’s, which will report earnings Wednesday.
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