Home Depot’s Profit Declines Along With Housing Market
An article published by Yahoo! Finance takes a look at the unwelcome decline (however unsurprising) in Home Depot’s third quarter profits. According to the article:
The Home Depot Inc. reported a 26.8 percent drop in third-quarter profits and revised its financial outlook Tuesday, saying a decline in earnings would be larger than expected as the housing market continues to deteriorate.
The nation’s largest home improvement store chain predicted a decline of as much as 11 percent in earnings per share from continued operations because of persistent “softness in the housing market.”
“We started the year with a more pessimistic view of the housing and home improvement markets than many,” Frank Blake, the company’s chairman and CEO, told analysts Tuesday. “It turns out we were not pessimistic enough.”
“We expect continued difficult conditions for the remainder of 2007,” Blake said. “We expect that the soft market will continue, as reflected in the current overhang of housing inventory and the difficulties in the subprime mortgage market.”
It is no surprise that all industries with ties to the housing market are experiencing losses, as they are failing to get out of debt. But this just goes to show how much of an effect the current subprime crisis is having on everyone. Retail stores and mortgage lenders alike have difficult times ahead as we struggle through the financial mess that is gripping our nation.
November 15, 2007 | Filed Under Get Out of Debt
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