ii view: Home Depot reports best comparable sales since 2022
Underperforming the Dow Jones index year-to-date and with concerns about rising interest rates overshadowing. Analyst Keith Bowman assesses prospects.
18th August 2026 16:01
by Keith Bowman from interactive investor
A Home Depot store in Austin, Texas. Photo: Brandon Bell/Getty Images.
Second-quarter results to 2 August
- Total sales up 5.7% to $47.9 billion (£35.4 billion)
- Comparable or Like-For-Like (LFL) sales up 1.7%
- Adjusted diluted Earnings Per Share (EPS) up 5.1% to $4.92 per share
Guidance:
- Continues to expect comparable sales of flat to up to 2%
- Continue to expect adjusted earnings per share for the full year 2026 to grow by between 0 and 4% from $14.69 in fiscal 2025
Chief financial officer Richard McPhail said: “Our second-quarter results exceeded our expectations. We saw broad-based demand across the business as customers continued to engage in smaller projects.
“This quarter’s results were a testament to our investments across the business and our associates’ focus on customer service.”
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ii round-up:
The Home Depot Inc (NYSE:HD) today reported sales and profits beating Wall Street hopes with the DIY retailing giant maintaining hopes for potential sales and earnings growth over the full year 2026.
Despite what temporary head Richard McPhail summarised as a “frozen” housing market, second-quarter revenues rose 5.7% from a year ago to $47.9 billion (£35.4 billion), pushing adjusted earnings up 5.1% to $4.92 per share. Analysts had expected outcomes of $47.3 billion and $4.73 per share respectively.
Shares in the Dow Jones company rose 1.5% in US trading having come into these latest results down around 2% so far in 2026. Shares for UK and European DIY retailer Kingfisher (LSE:KGF) are up by around 3% over that time, while the Dow index has improved by 8% year-to-date.
Home Depot operates more than 2,300 stores across the US, Canada and Mexico. The retailer just a week or so ago announced a temporary medical leave of absence for CEO Ted Decker, who is expected to return within the next few months.
Comparable or like-for-like store sales for this latest quarter rose 1.7%, an acceleration from +0.6% in the prior first quarter and their biggest gain since Q3 of 2022. Wall Street had forecast a rise of 0.9%. Management flagged market share gains in aiding the performance.
The Atlanta-headquartered retailer continues to expect comparable sales of flat to up to 2% for the full year, potentially pushing adjusted earnings up 4% from last year’s $14.69 per share outcome.
Third-quarter results are likely to be announced mid-November.
ii view:
Begun in 1978, Home Depot today employs more than 470,000 people. The company describes itself as the world’s biggest home improvement retailer. Total sales for 2025 hit $164.7 billion (£121.9 billion). Selling over 35,000 products instore and around one million items online, the US generated most sales during 2025 at 92%. with Canada and Mexico making up the balance of 8%.
For investors, a frozen housing market and concerns over rising interest rates given elevated energy prices are not to be overlooked. The temporary loss of the CEO warrants consideration. As with all retailers, the importance of the weather in influencing sales needs to be remembered, while US President Donald Trump’s tariffs on products imported from overseas have not gone away.
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More favourably, a frozen housing market may be pushing many homeowners to revamp their existing properties. The company has diversity across both products and geographical regions. A significant sourcing of US-made goods should help navigate trade tariff headwinds, while an estimated future dividend yield of around 2.7% is not to be overlooked.
On balance, and despite ongoing risks, this generally well-managed company looks to remain deserving of its place in many already diversified investor portfolios.
Positives:
- Strong brand name
- Attractive dividend (not guaranteed)
Negatives:
- Uncertain economic outlook
- Weather can impact performance
The average rating of stock market analysts:
Buy
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