The Zacks Retail-Home Furnishings industry shows cautious improvement despite ongoing macro pressures. High mortgage rates and weak housing turnover continue to suppress big-ticket spending, though premium categories supported by higher-income shoppers are holding up. 

Despite economic headwinds and tariff concerns, the industry’s tech-driven evolution signals a favorable long-term outlook. Companies combining digital innovation with strong branding and service integration are well-positioned to outperform in the evolving retail landscape. Digital platforms are driving growth with AR shopping tools, AI-powered personalization, and mobile-first strategies that appeal to Gen Z and millennials. Companies like Williams-Sonoma, Inc. (WSM Quick QuoteWSM - Free Report) , Somnigroup International Inc. (SGI Quick QuoteSGI - Free Report) , Floor & Decor Holdings, Inc. (FND Quick QuoteFND - Free Report) , Haverty Furniture Companies, Inc. (HVT Quick QuoteHVT - Free Report) , FGI Industries Ltd. (FGI Quick QuoteFGI - Free Report) have been leveraging product reinvention, efficient cost management, exclusive collaborations and innovative marketing strategies to stand out as winners, as they capture market share while enhancing the customer experience.

Industry Description

The Zacks Retail-Home Furnishings industry comprises retailers offering home furnishing products under various categories. The merchandise assortment includes furniture, garden accessories, framed art, lighting, mirrors, candles, tableware, lamps, picture frames, bathware, accent rugs, artificial floral products, and child and teen furnishing. The industry players also develop, manufacture, market and distribute bedding products. The companies provide home and security products for residential home repair, remodeling, new construction and security applications. They are involved in manufacturing, assembling and selling faucets, accessories, kitchen sinks and waste disposal.

3 Trends Shaping the Future of the Retail-Home Furnishings Industry

Online Growth, Tech platforms, Digital Services & Personalization: Continuing acceleration in online furniture shopping, combined with cutting-edge solutions like room visualizers and AR, unlocks strong growth potential. Major platforms, like Wayfair, Amazon and Williams-Sonoma, are investing heavily in AI driven personalization and immersive user experiences. Features like augmented reality (AR) room visualizers, virtual reality showrooms, and mobile first shopping are reshaping the consumer journey. Companies leading innovation in these areas are well positioned to capture share as convenience and digital engagement become critical in buying decisions.

Gen Z and millennials value customization. Services such as AI-driven design apps, virtual interior consulting, and bundling (such as packaged room solutions) will help the companies boost margins. For example, Lowe’s acquisition of Artison Design (a home furnishing design/install company) signals that offering full-service packages is lucrative. Furniture retailers can similarly offer in-home assembly, design subscription services, or AR “try-before-you-buy” apps to increase attachment rates and customer loyalty.

Strong Product Reinvention & Marketing Moves: Product innovation plays a pivotal role in market share gain in this industry. Companies aim to come up with products and collaborate with celebrated brands and designers to maintain exclusivity. Also, customer experience is being enhanced by innovative marketing techniques, with an emphasis on digital marketing, better merchandising, store remodeling and loyalty programs. The companies are also going for strategic omnichannel expansion. Even digitally native retailers are exploring brick-and-mortar formats to enhance brand visibility and customer experience. Wayfair’s first large-format store in Illinois exemplifies this hybrid approach. Meanwhile, premium players like RH RH continue expanding showrooms that blend physical touchpoints with high-end brand storytelling.

Macroeconomic Challenges: The companies continue to face significant macroeconomic challenges, primarily stemming from a weak housing market and persistently high interest rates that weigh on consumer spending for big-ticket home furnishings. Inflationary pressures and tariff volatility further complicate the landscape, with the industry players noting that its incremental tariff rates have doubled since first-quarter 2025, creating cost headwinds and margin risks. While selective price increases and supply chain efficiencies have been helping, rising import duties and global trade uncertainties make long-term sourcing and pricing strategies difficult to plan. These challenges mirror broader pressures across the U.S. retail home furnishings industry.

Also, fierce competition in the home furnishings space is intensifying, with online giants like Amazon and Wayfair, specialty retailers, and direct-to-consumer brands pressuring traditional stores.

Zacks Industry Rank Depicts Bright Prospects

The Zacks Retail-Home Furnishings industry is a 10-stock group within the broader Zacks Retail-Wholesale sector. The industry currently carries a Zacks Industry Rank #100, which places it in the top 41% of more than 250 Zacks industries.

The group’s Zacks Industry Rank, which is basically the average of the Zacks Rank of all the member stocks, indicates bullish near-term prospects. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1.

Before we present a few stocks that you may want to consider for your portfolio, let’s take a look at the industry’s recent stock-market performance and valuation picture.

Industry Lags the Sector & S&P 500

The Zacks Retail-Home Furnishings industry has underperformed the broader Zacks Retail-Wholesale sector and the Zacks S&P 500 Composite over the past year.

Over the past year, the industry has lost 21.3% against the broader sector’s 27.2% growth. The Zacks S&P 500 Composite has gained 16.4% in the same time frame.

One-Year Price Performance

Industry's Current Valuation

On the basis of the forward 12-month price-to-earnings ratio, which is commonly used for valuing retail home furnishing stocks, the industry is currently trading at 21.23 compared with the S&P 500’s 23.59 and the sector’s 24.94.

Over the last five years, the industry has traded as high as 25.1X and as low as 14.19X, with the median being 20.13X, as the chart below shows.

Industry’s P/E Ratio (Forward 12-Month) Versus S&P 500

5 Retail-Home Furnishings Stocks to Watch

We have highlighted five stocks from the industry that are capitalizing on fundamental strengths and have solid growth prospects.

FGI Industries: Based in East Hanover, NJ, FGI Industries provides bath and kitchen products to customers across North America, Europe and other international markets. The BPC strategy, which focuses on strengthening brands, expanding product innovation and deepening channel reach across regions, has been benefiting the company. Growth remains anchored in the resilient repair-and-remodel market, where sanitaryware demand rose 7% despite tariff pressures in the last reported quarter. The company is also scaling its presence in India and the UK, adding new dealers and winning programs, while digital ventures such as Isla Porter broaden its premium design reach. Margin improvement from a better mix and lower operating expenses further supports expansion. Strong customer relationships and diversified sourcing, including China+1 initiatives, also enhance long-term growth visibility.

The FGI Industries stock — currently carrying a Zacks Rank #1 (Strong Buy) — has gained 94.1% over the past year. Meanwhile, this company surpassed earnings estimates in two of the trailing four quarters, the average being 80.1%. For 2026, the Zacks Consensus Estimate indicates 56% growth from a year ago. You can see the complete list of today’s Zacks #1 Rank stocks here.

Price and Consensus: FGI

Somnigroup: Based in Lexington, KY, the company has been benefiting from several structural and strategic drivers that set it apart in a weak bedding industry backdrop. Somnigroup is gaining from strong execution across brands, deeper integration with Mattress Firm and consistent market share gains. The company is benefiting from robust like-for-like sales growth, fueled by new product innovation such as the refreshed Sealy Posturepedic lineup and higher advertising investments that are lifting consumer engagement. Mattress Firm’s improving in-store execution, store refresh program, and the rollout of Tempur brand walls are boosting ticket sizes and conversion. International operations continue to outperform with double-digit sales growth supported by expanded distribution and targeted marketing. Additionally, Somnigroup’s scale advantages, vertical integration and faster-than-expected sales and cost synergies are strengthening margins and reinforcing long-term earnings momentum.

The Somnigroup stock — currently carrying a Zacks Rank #2 (Buy) — has gained 64.2% over the past year. Meanwhile, this company surpassed earnings estimates in all the trailing four quarters, the average being 6.3%. Somnigroup has seen an upward estimate revision for 2025 and 2026 earnings to $2.69 per share (from $2.49) and $3.39 (from $3.21), respectively, over the past 30 days, depicting analysts’ optimism over the company’s prospects.

Price and Consensus: SGI

Haverty Furniture: Headquartered in Atlanta, GA, Haverty Furniture is a U.S. specialty retailer of residential furniture and home accessories. Haverty Furniture’s growth is being driven by steady gains in written and delivered sales, supported by stronger marketing, refreshed merchandise assortments and improved supply chain execution. Investments in AI-enhanced targeting, direct mail and digital channels boosted traffic and e-commerce growth, while higher average tickets and a robust design business lifted overall sales productivity. Category strength in bedroom, bedding and upholstery, along with resumed special-order activity after shifting production out of China, also contributed meaningfully. Strategic price adjustments helped maintain margins despite tariff pressures, and store expansion plans for 2026 reinforce the company’s pathway back to $1 billion-plus revenue. 

The HVT stock — currently carrying a Zacks Rank #3 (Hold) — has gained 0.7% over the past year. Nonetheless, Haverty Furniture has seen an upward estimate revision for 2025 earnings to $1.17 per share (from $1.14) over the past 60 days. The estimated figure for 2025 indicates 1.7% year-over-year growth, but a solid 83.3% growth for 2026. This company surpassed earnings estimates in all the trailing four quarters, the average being 66%.

Price and Consensus: HVT

Williams-Sonoma: This is a San Francisco, CA-based multi-channel specialty retailer. The company has been benefiting from strong multi-brand momentum, expanding retail productivity and ongoing strength in both furniture and non-furniture categories. The company is benefiting from improved inventory availability, enhanced in-store experiences, and double-digit gains in emerging brands like Rejuvenation and GreenRow. Strategic initiatives such as Dorm, West Elm Kids and B2B—up 9% in the fiscal third quarter—are widening its addressable market, while AI-driven customer service and supply-chain efficiencies are boosting conversion and profitability. With premium product innovation, reduced promotions, and successful collaborations, Williams-Sonoma continues to gain market share despite a weak housing backdrop. 

The WSM stock — currently carrying a Zacks Rank #3 — has lost 5.6% over the past year. Nonetheless, Williams-Sonoma has seen an upward estimate revision for fiscal 2025 and 2026 earnings to $8.69 per share (from $8.59) and $9.08 (from $9.04), respectively, over the past 30 days. This company surpassed earnings estimates in all the trailing four quarters, the average being 8.6%. The estimated figure for fiscal 2025 indicates a 1.1% year-over-year decline but 4.5% growth for fiscal 2026. Yet, it has an ROE of 53.1%.

Price and Consensus: WSM

Floor & Decor: Based in Atlanta, GA, Floor & Decor is a multi-channel U.S. retailer specializing in hard surface flooring, related accessories, and commercial surfaces. Floor & Decor’s growth is being driven by steady store expansion, with 20 new warehouse openings planned for 2025 and a long-term goal of 500 locations. The company is strengthening its supply chain through new distribution centers, improving cost efficiency and supporting market share gains. Growth initiatives such as kitchen cabinets, outdoor offerings, XL slabs and enhanced design services are boosting customer engagement and ticket size. Strong Pro customer loyalty, expanding commercial flooring via Spartan Surfaces, and disciplined pricing and expense management further support performance, positioning FND to benefit meaningfully when housing activity and hard-surface flooring demand recover.

The FND stock — currently carrying a Zacks Rank #3 — has lost 44.7% over the past year. Nonetheless, FND has seen an upward estimate revision for 2025 and 2026 earnings to $1.91 per share (from $1.83) and $2.13 (from $2.12), respectively, over the past 30 days. This company surpassed earnings estimates in all the trailing four quarters, the average being 16.1%. The estimated figure for 2025 indicates 3.2% year-over-year growth but 11.4% growth for 2026.

Price and Consensus: FND