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Valued at a market cap of $383.5 billion, The Home Depot, Inc. (HD) is a home improvement retailer based in Atlanta, Georgia. It sells a variety of building materials, home improvement products, lawn and garden products, décor items, as well as facilities maintenance, repair, and operations products.
This home improvement leader has lagged behind the broader market over the past 52 weeks. Shares of HD have gained 9.3% over this time frame, while the broader S&P 500 Index ($SPX) has surged 21.5%. Moreover, on a YTD basis, the stock is down marginally, compared to SPX’s 7.1% uptick.
However, zooming in further, HD has outpaced the iShares U.S. Home Construction ETF’s (ITB) 8% loss over the past 52 weeks. Meanwhile, on a YTD basis, it has underperformed the ETF’s marginal rise.
HD’s stock plunged marginally on May 20, after it delivered mixed Q1 results. Due to steady engagement in its smaller projects and successful spring events, the company’s overall revenue advanced 9.4% year-over-year to $39.9 billion, surpassing consensus estimates. However, on the downside, its comparable sales decreased marginally from the prior-year quarter due to elevated interest rates and ongoing macroeconomic uncertainty. Moreover, its adjusted operating margin dropped by 90 basis points, which led to a 3% year-over-year decline in its adjusted EPS to $3.56. The bottom-line figure fell short of analyst expectations, lowering investor confidence.
For the current fiscal year, ending in January 2026, analysts expect HD’s EPS to decline 1.4% year over year to $15.03. The company’s earnings surprise history is mixed. It surpassed the consensus estimates in three of the last four quarters, while missing on another occasion.
Among the 34 analysts covering the stock, the consensus rating is a "Strong Buy” which is based on 25 “Strong Buy,” one "Moderate Buy,” seven “Hold,” and one “Strong Sell” rating.
This configuration is slightly less bullish than two months ago, with 26 analysts suggesting a “Strong Buy” rating.
On May 20, Gordon Haskett maintained a "Hold" rating on HD and raised its price target to $360.
The mean price target of $421.94 represents a 9.5% premium from HD’s current price levels, while the Street-high price target of $475 suggests an upside potential of 23.2%.
