HD stock forecast, quote, news & analysis

Key Takeaways

• Fourth‑quarter FY 2025 sales fell 3.8% YoY (year‑over‑year) but comparable sales held steady at +0.4%.
• Management raised the quarterly dividend by 1.3% to $2.33 per share and reaffirmed FY 2026 earnings guidance of flat‑to‑4% EPS growth.
• Analyst sentiment is mixed: Bernstein and Wells Fargo cut price targets to $365‑$375, while a few firms maintain “Buy” ratings.
• SRS Distribution’s acquisition of HVAC distributor Mingledorff’s expands the pro‑services addressable market to roughly $1.2 trillion.
• Upcoming Q1 2026 earnings (May 19) are expected to show $3.42 EPS on $41.6 billion revenue, a modest decline from the prior year.

Current Market Snapshot

In recent weeks Home Depot (HD) has been trading near the lower end of its 52‑week range, hovering just above $300 after a steady decline from the $426 peak earlier in the year. The stock remains below its 20‑day and 200‑day moving averages, reflecting broader market caution in the home‑improvement sector despite overall equity market gains.

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Recent Developments Driving HD Price Action

Earnings and Guidance – On February 24, 2026 Home Depot reported fourth‑quarter sales of $38.2 billion, down 3.8% YoY, but comparable sales rose 0.4% (U.S. comparable sales +0.3%). Adjusted diluted EPS was $2.72 versus $2.52 consensus. Management increased the quarterly dividend to $2.33 per share (annualized $9.32) and issued FY 2026 guidance: total sales growth 2.5%‑4.5%, comparable sales flat‑to‑2%, and diluted EPS growth flat‑to‑4% from FY 2025’s $14.23.

Analyst Actions – In the past month Bernstein cut its price target to $365 (from $390) and kept a Market Perform rating, citing muted housing demand. Wells Fargo lowered its target to $375 (from $420) while retaining an Overweight stance, noting consumer discretionary weakness. Wall Street Zen downgraded HD from “Hold” to “Sell.” Despite these cuts, the consensus rating remains “Moderate Buy” with an average target near $410.

Strategic Acquisitions – SRS Distribution, a Home Depot subsidiary, completed the acquisition of Mingledorff’s, a southeastern HVAC wholesale distributor, on May 11. The deal adds a new vertical to SRS’s portfolio (roofing, pool, landscape, wallboard) and expands the professional market addressable size to roughly $1.2 trillion, positioning Home Depot to capture more contractor spend.

Partnerships and Branding – In March, Home Depot announced a partnership with former soccer star David Beckham to promote the FIFA World Cup 2026™ campaign, aiming to boost backyard and outdoor‑living sales ahead of the tournament.

Macro‑Economic Context – Existing‑home sales have stalled near 3% of transactions, well below the historic 4%‑5% norm, creating a “confidence problem” rather than a balance‑sheet issue, according to CFO Richard V. McPhail. Mortgage rates remain above 6%, limiting large‑ticket project initiation while repair‑and‑maintenance spending holds up, keeping comparable‑sales growth modest.

Collectively, these events explain why HD’s price has been pressured: earnings growth is modest, analyst sentiment has softened, and housing softness limits big‑ticket sales, even as dividend stability and long‑term strategic moves (HVAC acquisition, pro‑services expansion) provide upside catalysts.

2026 Outlook and Key Factors to Monitor

Looking ahead to fiscal 2026, Home Depot’s performance will hinge on several themes. First, the pace of U.S. housing turnover will determine whether big‑ticket remodels rebound; a shift back toward the historic 4%‑5% transaction rate could lift comparable sales toward the upper end of the 0%‑2% guidance range. Second, the integration of Mingledorff’s should begin to reflect in pro‑segment revenue, especially in HVAC and related services, once cross‑selling efficiencies materialize. Third, commodity price trends (lumber, steel) and supply‑chain resilience will affect margin stability—any sustained input‑cost inflation could pressure operating margins despite the targeted 12.4%‑12.6% operating‑margin range. Fourth, the dividend’s 3.1% yield provides a floor for income‑focused investors, but a dividend cut would signal deeper earnings weakness. Finally, macro‑economic variables—interest‑rate outlook, consumer confidence, and inflation trends—remain headwinds that could delay the recovery of discretionary spending. Investors should monitor quarterly comparable‑sales trends, pro‑segment revenue mix, margin guidance updates, and any revisions to FY 2026 earnings forecasts.

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