September 19, 2014
Investors don’t seem to care that Home Depot’s data breach is being characterized as the largest ever in the retail sector with shares of the company hitting a new high on Friday.
Home Depot shares touched a 52-week high of $93.75 on Friday, a day after the company disclosed details about an extensive data breach which went undetected for months and compromised the information of 56 million customers.
The company confirmed that the malware used in its recent breach has been eliminated from its U.S. and Canadian networks and provided new details about the completion of a major payment security project designed to increase data security. The project provides enhanced encryption of payment data at the point of sale in the company’s U.S. stores, offering significant new protection for customers, the company said. Roll-out of enhanced encryption to Canadian stores will be complete by early 2015. Canadian stores are already enabled with EMV or “Chip and PIN” technology.
Despite the expense of the IT investigation and remediation efforts, the strength of Home Depot’s business during the period when hackers were stealing customers’ data enabled it to increase its full year profit forecast by two cents to $4.54. While the updated guidance includes various expenses already incurred, it does not reflect potentially substantial accruals for future losses the company said are probably but cannot be quantified at this time.
Source: Retailing Today
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