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Home Depot missed Q3 EPS, reporting $3.74 vs $3.81 expected.
Weak demand and slower housing drove lowered guidance for FY25.
Stock faces downside risk below support; technicals warn of further pressure.
Home Depot (HD - Free Report) is a Zacks Rank #5 (Strong Sell) that is the world’s largest home improvement specialty retailer. The company offers a broad mix of branded and proprietary building materials, tools, décor, and lawn and garden products through more than 2,300 stores and an expansive network of branches and distribution centers across the United States, Canada, and Mexico.
While the stock has pulled back, investors might want to avoid any dip buying until earnings come out on November 13th. Estimates have been falling and with a valuation so high any disappointment on EPS or the outlook could take shares lower.
About the Company
Home Depot was founded in 1978. is based in Atlanta, GA and has 470,000 employees.
The company serves three primary customer groups: DIY homeowners, DIFM customers who use professional installation services, and professional contractors, remodelers, and tradespeople.
Home Depot combines its large-format stores, extensive distribution network, and e-commerce platforms, including homedepot.com and several specialty websites, to provide an integrated, omnichannel shopping experience for consumers and professionals alike.
The company has a market cap over $350B, with a Zacks Style Score of “F” in Value and “B” in Momentum.
Q3 Earnings Miss
Home Depot reported third-quarter earnings of $3.74 per share, missing the consensus estimate of $3.81, while revenue came in slightly above expectations at $41.4 billion.
The miss was blamed by a lack of storm activity, which weighed on demand in certain categories, as well as ongoing consumer uncertainty and continued pressure in the housing market. Comparable sales were essentially flat, with total U.S. same-store sales up just 0.1% and customer transactions declining 1.4% year over year. The company noted that underlying demand remained stable sequentially, but anticipated seasonal pickup in the third quarter did not materialize.
Looking ahead, Home Depot trimmed its full-year EPS outlook to roughly $14.02, down about 6% from last year and below the prior estimate of $14.97, while total revenue is expected to grow around 3% thanks in part to GM’s contributions.
Same-store sales are now expected to be “slightly positive” year over year, and the company reduced its planned new store openings slightly. Management highlighted that consumer caution and a slower housing market continue to weigh on home improvement spending, with no immediate catalysts for acceleration, though digital sales remain strong and the professional customer segment is benefiting from AI-enabled tools and enhanced service offerings.
Earnings Estimates Drop
Home Depot saw pressure on the stock initially as earnings estimates were cut across the board.
For the current quarter, estimates fell 11%, dropping from $2.91 to $2.62. Next quarter also weakened, falling 4%.
For the current year, numbers have dropped $15.01 to $14.64, or 2%. And next year we see a similar trend, with estimates lowered by almost 5% over the last 90 days.
Technical Take
The stock traded near 2024 lows after the earnings report, but has since bounced back 9% off the lows. That recent bottom around $325-$330, was the Liberation Day bottom, so investors should keep an eye on that level.
A move below recent support will put further pressure on the stock and likely take HD below $300.
To the upside, investors should look to sell the bounces at resistance. The 21-day moving average is $360, the 200-day MA is$376 and the 50-day MA is $380. That 50-day is close to moving below the 200-day, which would trigger a “Death Cross” and more program selling.
In Summary
Home Depot (HD - Free Report) faces a challenging backdrop of slower housing activity, cautious consumers, and seasonal headwinds that have pressured both earnings and guidance. While digital momentum and professional customer initiatives provide some support, the recent EPS miss and downward revisions to estimates suggest investors should remain cautious. Technical signals also point to potential downside risk if key support levels fail, making HD a stock to monitor closely rather than buy on dips until clearer catalysts emerge.
For now, investors looking at home furnishings should consider FGI Industries (FGI - Free Report) . The stock is a Zacks Rank #1 (Strong Buy) that has recently broken above its October highs.
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Bear of the Day: Home Depot (HD)
Key Takeaways
Home Depot (HD - Free Report) is a Zacks Rank #5 (Strong Sell) that is the world’s largest home improvement specialty retailer. The company offers a broad mix of branded and proprietary building materials, tools, décor, and lawn and garden products through more than 2,300 stores and an expansive network of branches and distribution centers across the United States, Canada, and Mexico.
While the stock has pulled back, investors might want to avoid any dip buying until earnings come out on November 13th. Estimates have been falling and with a valuation so high any disappointment on EPS or the outlook could take shares lower.
About the Company
Home Depot was founded in 1978. is based in Atlanta, GA and has 470,000 employees.
The company serves three primary customer groups: DIY homeowners, DIFM customers who use professional installation services, and professional contractors, remodelers, and tradespeople.
Home Depot combines its large-format stores, extensive distribution network, and e-commerce platforms, including homedepot.com and several specialty websites, to provide an integrated, omnichannel shopping experience for consumers and professionals alike.
The company has a market cap over $350B, with a Zacks Style Score of “F” in Value and “B” in Momentum.
Q3 Earnings Miss
Home Depot reported third-quarter earnings of $3.74 per share, missing the consensus estimate of $3.81, while revenue came in slightly above expectations at $41.4 billion.
The miss was blamed by a lack of storm activity, which weighed on demand in certain categories, as well as ongoing consumer uncertainty and continued pressure in the housing market. Comparable sales were essentially flat, with total U.S. same-store sales up just 0.1% and customer transactions declining 1.4% year over year. The company noted that underlying demand remained stable sequentially, but anticipated seasonal pickup in the third quarter did not materialize.
Looking ahead, Home Depot trimmed its full-year EPS outlook to roughly $14.02, down about 6% from last year and below the prior estimate of $14.97, while total revenue is expected to grow around 3% thanks in part to GM’s contributions.
Same-store sales are now expected to be “slightly positive” year over year, and the company reduced its planned new store openings slightly. Management highlighted that consumer caution and a slower housing market continue to weigh on home improvement spending, with no immediate catalysts for acceleration, though digital sales remain strong and the professional customer segment is benefiting from AI-enabled tools and enhanced service offerings.
Earnings Estimates Drop
Home Depot saw pressure on the stock initially as earnings estimates were cut across the board.
For the current quarter, estimates fell 11%, dropping from $2.91 to $2.62. Next quarter also weakened, falling 4%.
For the current year, numbers have dropped $15.01 to $14.64, or 2%. And next year we see a similar trend, with estimates lowered by almost 5% over the last 90 days.
Technical Take
The stock traded near 2024 lows after the earnings report, but has since bounced back 9% off the lows. That recent bottom around $325-$330, was the Liberation Day bottom, so investors should keep an eye on that level.
A move below recent support will put further pressure on the stock and likely take HD below $300.
To the upside, investors should look to sell the bounces at resistance. The 21-day moving average is $360, the 200-day MA is$376 and the 50-day MA is $380. That 50-day is close to moving below the 200-day, which would trigger a “Death Cross” and more program selling.
In Summary
Home Depot (HD - Free Report) faces a challenging backdrop of slower housing activity, cautious consumers, and seasonal headwinds that have pressured both earnings and guidance. While digital momentum and professional customer initiatives provide some support, the recent EPS miss and downward revisions to estimates suggest investors should remain cautious. Technical signals also point to potential downside risk if key support levels fail, making HD a stock to monitor closely rather than buy on dips until clearer catalysts emerge.
For now, investors looking at home furnishings should consider FGI Industries (FGI - Free Report) . The stock is a Zacks Rank #1 (Strong Buy) that has recently broken above its October highs.