Home Depot Inc. (HD.N), the world's largest home improvement chain, reported higher-than-expected profit and sales helped by a strong housing market in the United States and set a US$15 billion share repurchase plan.

Shares of the company rose 3 per cent to US$147.20 in premarket trading on Tuesday.

The company also forecast 2017 same-store sales growth of 4.6 per cent and profit of US$7.13 per share.

The Atlanta, Georgia-based company said same-store sales rose 5.8 per cent during the quarter ended Jan. 29, beating analysts' average estimate of a rise of 3.5 per cent, according to research firm Consensus Metrix.

U.S. homebuilding jumped 11.3 per cent in December as a firming economy and higher wages due to a tightening labor market boosted demand for rental housing.

The company reported a 5.8 per cent rise in quarterly sales to US$22.21 billion. Analysts on average had expected $21.81 billion, according to Thomson Reuters I/B/E/S.

Home Depot's net earnings rose to US$1.74 billion, or US$1.44 per share, in the fourth quarter, from US$1.47 billion, or US$1.17 per share, a year earlier.

Excluding items, the company earned US$1.44 per share, beating estimates of US$1.34 per share.