From the Desk of Irwin Michael – August 19, 2016: The Home Depot On Tuesday, The Home Depot reported a strong second quarter and raised its forward operating guidance. The company earned $1.97 per share, which was in line with analysts’ expectations, however, a significant positive was The Home Depot’s full year outlook of $6.31 per share, up from a previous estimate of $6.27. In reviewing Q2 results, Home Depot showed a strong increase in big ticket items, particularly appliances, however, it appears that the company also benefited from solid operational improvement via good execution, market share gains and recovering home renovation spending. Furthermore, management continues to tightly control costs and boost margins, which should bode well for the future. Moreover, The Home Depot strategy to grow its online presence, focus on the professional segment, while driving traffic to its stores, contributed to a 4.7% same store sales growth in the quarter. The company is free cash flowing, pays a 2% dividend and has a share buyback program in place. Overall, we believe The Home Depot should continue to be a beneficiary of increased consumer home renovations which should provide a solid business growth tailwind for the balance of 2016 and into 2017. Irwin A. Michael, President I.A. Michael Investment Counsel Ltd.