Home Depot (NYSE:HD) Trading 1% Higher - Should You Buy?

Key Points

• Home Depot shares rose 1% to about $308.86, but remain below their 50-day and 200-day moving averages near $334. The stock trades at roughly 21.6 times earnings, with a market capitalization of about $308 billion.
• The company’s latest quarter exceeded expectations, with adjusted earnings of $4.92 per share and revenue of $47.86 billion, up 5.7% year over year. Growth among professional customers, digital sales and fulfillment may offset continued weakness in housing-related demand.
• Risks include declining customer traffic, a potential prolonged housing slowdown and more cautious analyst sentiment. Still, analysts maintain a “Moderate Buy” consensus with an average $375.18 price target, while Home Depot offers a $2.33 quarterly dividend, yielding approximately 3%.

The Home Depot, Inc. (NYSE:HD - Get Free Report) traded up 1% on Friday . The company traded as high as $311.21 and last traded at $308.8580. Approximately 3,149,749 shares traded hands during trading, a decline of 27% from the average session volume of 4,324,503 shares. The stock had previously closed at $305.69.

Home Depot News Roundup

Here are the key news stories impacting Home Depot this week:

• Positive Sentiment: Home Depot’s long-term growth case is supported by momentum among professional customers, expanding digital sales and faster fulfillment capabilities. These factors could help offset weakness in housing-related demand. Home Depot Drops 12.4% in a Month: Time to Buy or Stay Cautious?
• Positive Sentiment: The retailer is attempting to improve the shopping experience with a perk modeled after Costco’s membership approach. If successful, the initiative could support customer engagement and store traffic. Home Depot Tries to Copy Major Costco Perk
• Positive Sentiment: Home Depot continues to be viewed as a durable dividend-growth company, which may appeal to income-focused investors while the broader home-improvement cycle remains weak. Stocks That Keep Raising Their Dividend
• Neutral Sentiment: A quantitative signal has emerged that could interest contrarian options traders, but it does not establish a fundamental catalyst or guarantee a reversal in HD’s decline. Quant Signal for Contrarian Options Traders
• Negative Sentiment: The key concern is weakening customer traffic: recent results reportedly showed growth driven by larger baskets but fewer shopping visits. A prolonged housing-market freeze could pressure comparable sales and earnings. What Happens to Home Depot Stock If Shoppers Keep Visiting Less?
• Negative Sentiment: Analyst sentiment has weakened. Erste Group Bank trimmed its FY2028 EPS forecast to $16.02 from $16.05, while Sanford C. Bernstein issued a pessimistic stock-price outlook. The small estimate cut is not material by itself, but it reinforces broader caution around housing and costs. Sanford C. Bernstein Forecast for Home Depot

Wall Street Analyst Weigh In

A number of analysts have commented on the stock. Oppenheimer cut their price target on shares of Home Depot from $405.00 to $310.00 and set a "market perform" rating on the stock in a research report on Monday, May 18th. Piper Sandler lowered their price objective on Home Depot from $422.00 to $421.00 and set an "overweight" rating for the company in a research report on Wednesday, May 20th. JPMorgan Chase & Co. dropped their price objective on Home Depot from $423.00 to $396.00 and set an "overweight" rating on the stock in a research note on Wednesday, May 20th. Telsey Advisory Group cut their target price on Home Depot from $435.00 to $410.00 and set an "outperform" rating on the stock in a research report on Wednesday, May 20th. Finally, Guggenheim reaffirmed a "buy" rating and set a $425.00 target price on shares of Home Depot in a research note on Wednesday, August 19th. Eighteen investment analysts have rated the stock with a Buy rating, thirteen have given a Hold rating and one has issued a Sell rating to the stock. According to MarketBeat.com, the company presently has a consensus rating of "Moderate Buy" and an average target price of $375.18.

Home Depot Price Performance

The company has a debt-to-equity ratio of 2.64, a current ratio of 1.08 and a quick ratio of 0.31. The firm has a market capitalization of $308.14 billion, a price-to-earnings ratio of 21.61, a PEG ratio of 3.42 and a beta of 0.95. The business's fifty day simple moving average is $336.12 and its 200 day simple moving average is $334.07.

Home Depot (NYSE:HD - Get Free Report) last announced its quarterly earnings data on Tuesday, August 18th. The home improvement retailer reported $4.92 earnings per share for the quarter, beating the consensus estimate of $4.73 by $0.19. The firm had revenue of $47.86 billion for the quarter, compared to analyst estimates of $47.24 billion. Home Depot had a net margin of 8.41% and a return on equity of 106.42%. The business's quarterly revenue was up 5.7% compared to the same quarter last year. During the same quarter in the prior year, the business earned $4.68 earnings per share. Home Depot has set its FY 2026 guidance at 14.690-15.278 EPS. On average, research analysts forecast that The Home Depot, Inc. will post 15 EPS for the current year.

Home Depot Announces Dividend

The company also recently declared a quarterly dividend, which will be paid on Thursday, September 17th. Investors of record on Thursday, September 3rd will be paid a dividend of $2.33 per share. This represents a $9.32 dividend on an annualized basis and a yield of 3.0%. The ex-dividend date of this dividend is Thursday, September 3rd. Home Depot's dividend payout ratio is 65.22%.

Insider Transactions at Home Depot

In other Home Depot news, EVP Michael Rowe sold 710 shares of the stock in a transaction that occurred on Wednesday, August 26th. The stock was sold at an average price of $336.76, for a total value of $239,099.60. Following the transaction, the executive vice president owned 6,838 shares in the company, valued at approximately $2,302,764.88. This represents a 9.41% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is accessible through this hyperlink. Also, CFO Richard McPhail sold 5,989 shares of the firm's stock in a transaction that occurred on Wednesday, August 19th. The shares were sold at an average price of $348.40, for a total value of $2,086,567.60. Following the completion of the sale, the chief financial officer directly owned 48,104 shares of the company's stock, valued at $16,759,433.60. This trade represents a 11.07% decrease in their position. The disclosure for this sale is available in the SEC filing. Insiders sold a total of 9,829 shares of company stock valued at $3,339,314 in the last 90 days. Corporate insiders own 0.08% of the company's stock.

Institutional Trading of Home Depot

Hedge funds have recently bought and sold shares of the business. Brighton Jones LLC raised its stake in shares of Home Depot by 36.5% in the fourth quarter. Brighton Jones LLC now owns 26,918 shares of the home improvement retailer's stock worth $10,471,000 after purchasing an additional 7,203 shares during the last quarter. Sivia Capital Partners LLC grew its holdings in Home Depot by 7.1% during the second quarter. Sivia Capital Partners LLC now owns 2,598 shares of the home improvement retailer's stock worth $952,000 after buying an additional 173 shares in the last quarter. Schnieders Capital Management LLC. grew its holdings in Home Depot by 14.1% during the second quarter. Schnieders Capital Management LLC. now owns 11,587 shares of the home improvement retailer's stock worth $4,248,000 after buying an additional 1,433 shares in the last quarter. Darwin Wealth Management LLC purchased a new stake in Home Depot in the 2nd quarter valued at $1,773,000. Finally, Financial Advisors Network Inc. raised its position in Home Depot by 11.3% in the 2nd quarter. Financial Advisors Network Inc. now owns 2,368 shares of the home improvement retailer's stock valued at $868,000 after buying an additional 241 shares during the last quarter. Institutional investors and hedge funds own 70.86% of the company's stock.

About Home Depot

The Home Depot, Inc is a home improvement retailer that sells building materials, appliances, decor, hardware, tools, paint, lawn and garden products, and related merchandise. The company serves do-it-yourself customers, professional contractors, homebuilders, and other commercial customers through its retail stores and digital platforms.

Home Depot also provides services such as equipment and tool rental, delivery, installation, and project support. Its professional-focused offerings include job-lot quantities, specialized products, credit services, and account support designed for contractors and other trade customers.

Founded in 1978 by Bernie Marcus, Arthur Blank, Ken Langone, and Pat Farrah, the company is headquartered in Atlanta, Georgia.

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