Home Depot announces $15 billion share buyback scheme
Published: 6 December 2017 - Fiona Garcia
The US home improvement giant has, today, announced a $15 billion share repurchase plan and set out a target to grow annual sales to between $114.7 billion and $119.8 billion by the year ending January 2021.
The company said the new buyback program, for which it did not set a time period, would replace its previous authorisation. Since 2002 and through the third quarter of fiscal 2017, the company has returned approximately $73 billion of cash to shareholders through repurchases, repurchasing approximately 1.3 billion shares.
The announcement was made, as Home Depot prepared to lay out its strategy to shareholders, as te company reaffirmed its sales predictions for the year.
Home Deport chairman, CEO and president, Craig Menear said: "The retail landscape is changing at unprecedented rates and we plan to invest for the future to address the evolving needs of our customers. We will accelerate our investments, while continuing to focus on delivering the value our shareholders expect from The Home Depot.”
Home Depot expects sales to increase approximately 6.3% percent for the year, with comparable store sales of approximately 6.5%. It also expects fiscal 2017 diluted earnings per share to grow approximately 14% to $7.36. This diluted earnings-per-share guidance includes the benefit of its intent to repurchase an additional $2.1 billion of shares in the fourth quarter, bringing total fiscal 2017 share repurchases to $8 billion.
Home Depot is investing more in creating a more connected customer experience
The Company said it intends to accelerate investment over the next three years in order to enhance the customer experience, position itself for the future and create value for shareholders.
As part of its aim to position itself as "One Home Depot," the retail chain will invest in its stores and creating a more “connected customer experience”, as well as looking at improving its supply chain and delivery capabilities
The company said it wants to highlight the “various ways it is leveraging its physical and digital assets to keep pace with changing customer expectations”.
At the end of the third quarter, the Company operated a total of 2,283 retail stores in all 50 states, the District of Columbia, Puerto Rico, U.S. Virgin Islands, Guam, 10 Canadian provinces and Mexico. The Company employs more than 400,000 associates. The Home Depot's stock is traded on the New York Stock Exchange (NYSE: HD) and is included in the Dow Jones industrial average and Standard & Poor's 500 index.