Core Insights - Home Depot (HD) reported disappointing Q3 earnings, with overall sales increasing by 2.8% compared to Q3 2024, which is a positive aspect amidst the overall underperformance [1] Financial Performance - The cost of goods sold increased in line with sales, indicating that the company managed its cost structure effectively despite the disappointing earnings [1]

Core Insights - Instacart has partnered with The Home Depot Canada to provide same-day delivery services from over 175 stores, enhancing customer access to home improvement essentials during the holiday season [1][2]. Company Overview - Instacart is a leading grocery technology company in North America, collaborating with over 1,800 retail banners to facilitate online shopping and delivery services from nearly 100,000 stores [5]. - The Home Depot is the largest home improvement specialty retailer globally, operating 2,356 retail stores and employing over 470,000 associates [7]. Partnership Details - The partnership allows The Home Depot Canada to be the first nationwide home improvement retailer available on Instacart in Canada, joining over 100 retail banners on the platform [2]. - Instacart's Big & Bulky fulfillment solution will enable same-day and scheduled deliveries for heavy items up to 60 pounds, including large tool sets and renovation supplies [2]. Customer Experience - The partnership aims to create a seamless shopping experience for customers, offering flexibility in shopping options, whether online, through the app, or in-store [3]. - A limited-time promotional offer of $20 off purchases of $80 or more at The Home Depot Canada via Instacart is available until December 8, 2025 [4].

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Key Takeaways HD's Q3 comparable sales rose just 0.2%, missing forecasts amid weak storm-driven category demand.Consumer caution and housing turnover at 40-year lows are pressuring large discretionary projects.HD cut its FY25 comp sales outlook, signaling demand may be settling into a lower equilibrium.The Home Depot, Inc.’s (HD) comparable sales growth of just 0.2% in the third quarter of fiscal 2025, following a 1% increase in the second quarter, raises an important question: Is this soft comparable sales ...

Core Viewpoint - The Home Depot, Inc. (NYSE:HD) is recognized as one of the best consumer cyclical stocks, operating over 2,300 stores across the US, Canada, and Mexico [1] Analyst Recommendations - As of November 28th, 19 out of 37 analysts rated The Home Depot as a Buy, with 14 Hold and 4 Strong Buy recommendations [2] - The average share price target for The Home Depot is set at $403.36 [2] Recent Analyst Coverage - Citigroup maintained a Buy rating for The Home Depot but lowered the share price target from $422 to $407 following the latest earnings report [3] - The company reported $41.35 billion in revenue for the fiscal third quarter, exceeding analyst estimates of $41.10 billion, but adjusted earnings per share of $3.74 fell short of the $3.84 estimate [3] Management Insights - Management cited lower consumer spending, weaker demand for home improvement products, and fewer storms as reasons for the profit cut [4] - CEO Edward Decker highlighted that home price appreciation, household formation, and housing turnover are currently under pressure, impacting demand [4] - There is an estimated $50 billion cumulative under spend in normal repair and remodel activity in U.S. housing, indicating a potential for future growth despite current pressures [5]

Market Performance - The S&P 500 index closed at 6,849, reflecting a weekly increase of 3.7% and a year-to-date increase of 16.4%[6] - The Nasdaq 100 index reached 25,435, with a weekly rise of 4.9% and a year-to-date increase of 21.0%[6] - The Dow Jones Industrial Average increased by 3.2% this week, with a year-to-date growth of 12.2%[6] Sector Analysis - The automotive and auto parts sector saw a significant weekly increase of 9.3% and a year-to-date increase of 9.9%[9] - The information technology sector reported a weekly rise of 4.6% and a year-to-date increase of 32.8%[9] - The healthcare sector experienced a weekly increase of 1.9% and a year-to-date increase of 21.0%[9] Fund Flows - The energy sector recorded a net inflow of $48 million this week, with a total of $572 million over the past 52 weeks[11] - The materials sector faced a net outflow of $290 million this week, totaling a negative $3.344 billion over the past 52 weeks[11] - The financial sector had a net inflow of $2.106 billion this week, with a total outflow of $6.723 billion over the past 52 weeks[11] Earnings Forecast - The overall EPS adjustment for the energy sector was 0.3% this week, with a year-to-date adjustment of -7.4%[14] - The materials sector saw an EPS adjustment of 0.6% this week, with a year-to-date adjustment of 4.9%[14] - The information technology sector's EPS adjustment was 0.6% this week, with a year-to-date adjustment of 28.0%[14]

Core Viewpoint - The article highlights three dividend-paying stocks—AbbVie, Home Depot, and ExxonMobil—that have consistently raised their dividends for over a decade, offering yields significantly higher than the S&P 500 average, making them attractive long-term investments. AbbVie - AbbVie currently offers a dividend yield of approximately 2.9%, which is more than double the S&P 500 average of 1.2% [3] - The company has a history of over 50 consecutive years of dividend increases, qualifying it as a Dividend King [3][4] - AbbVie recently raised its dividend by 5.5%, and since its spin-off from Abbott Laboratories, it has increased quarterly dividends by over 330% [4] - For the first nine months of the year, AbbVie reported an 8% increase in sales, totaling $44.5 billion, with Skyrizi and Rinvoq generating $18.5 billion, surpassing Humira's current quarterly sales of $3.3 billion [6][7] Home Depot - Home Depot has raised its dividend for 16 consecutive years, with a more than 50% increase since 2020, currently yielding 2.7% [8] - Despite facing challenges due to decreased discretionary spending, the company anticipates a 3% sales growth for the current fiscal year [9] - Home Depot's shares have declined by 13% this year, but the company is expected to recover in the long term due to its strong position in the home repair market [12] ExxonMobil - ExxonMobil offers the highest yield among the three at 3.5%, with a history of 43 consecutive years of annual dividend growth at an average rate of 5.8% [13][14] - The company has faced earnings volatility, with a decline of $3.7 billion to $22.3 billion this year, but it maintains strong financial health, with earnings per share of $5.16 exceeding its annual dividend payout of $4.12 [14][16] - ExxonMobil's stock has increased by 8% this year and is trading at an estimated 16 times its future earnings, presenting a good value for income investors [16]

Group 1 - The Home Depot, Inc. (NYSE:HD) is considered one of the best slow growth stocks, with TD Cowen maintaining a Buy rating but lowering the price target from $470 to $410 following disappointing third-quarter results and a reduced fourth-quarter forecast [1] - The company has revised its full-year 2025 earnings per share outlook to approximately $14.50, down from the previous expectation of $15.00, citing a deteriorating housing market and consumer uncertainty as key factors affecting demand [2] - Inventory levels have increased by 10% year-over-year, raising concerns about gross margins, which are anticipated to decline by around 75 basis points in the fourth quarter [2] Group 2 - Despite the challenges, TD Cowen remains optimistic about Home Depot's competitive position, stating that the company has "more ways to win versus peers" in the home improvement retail sector [3] - Home Depot operates over 2,300 stores globally, providing a wide range of tools, building materials, appliances, and services for both DIY and professional projects [3]

Core Insights - The article discusses the current state of the American consumer market, highlighting mixed signals in retail sales and consumer confidence ahead of the Thanksgiving holiday [2][3] - It emphasizes the polarization in economic activity, particularly between affluent and less-affluent consumers, and the potential impact on consumer spending [4] Consumer Market Overview - Retail sales in the US grew by 0.2% in September, a slowdown from 0.6% in August, with declines in clothing retailers (0.7%), electronics and appliances (0.5%), and car dealerships (0.3%) [2] - The Consumer Confidence Index dropped to 88.7 points in November, down 6.8 points from October's 95.5, indicating a lack of optimism among consumers [3] Economic Insights - EY's chief economist noted a "K-shaped" economy, where affluent individuals experience different economic outcomes compared to less-affluent ones, leading to increased polarization in economic activity [4] - The "A-Pillar" economy, driven by AI, asset prices, and affluent consumers, is at risk if any of these pillars falter, potentially leading to reduced consumer spending [4] Stock Recommendations - The article lists 12 consumer cyclical stocks recommended by analysts, focusing on those with high upside potential and hedge fund sentiment [6][7] - Carvana Co. (NYSE:CVNA) has an average upside potential of 12% and has seen a 79% increase in shares year-to-date, with a target of selling three million vehicles annually over the next 5 to 10 years [8][11] - The Home Depot, Inc. (NYSE:HD) has an average upside potential of 13.01%, but recently cut its full-year earnings forecast due to lower consumer spending and weaker demand for home improvement products [12][14][15]

Consumer Behavior - The consumer is characterized as stable but choiceful, being careful with spending while still participating in key shopping events [2][4] - Retailers expect strong sales during the Turkey 5 holiday weekend, but a deeper drop-off in sales post-holiday is anticipated [3] Retail Environment - Retailers like Dick's Sporting Goods and Best Buy expect more promotional and deeper discounts this year due to consumer sensitivity to pricing [4] - Retailers are raising prices to create a cushion for deeper discounts during key events, reflecting the pressure on consumers [5] Technological Impact - The upcoming holiday season is expected to be the last before widespread adoption of artificial intelligence in shopping, which will change the competitive landscape [6][7] - Retailers will need to adjust quickly to a more commoditized pricing environment driven by technology [7] Profitability Strategies - Retail media and advertising sales are becoming increasingly important for retailer profitability as pricing becomes more ubiquitous [9] - Large, well-positioned retailers like Walmart, Home Depot, and Costco are expected to benefit from their technological advancements [10] Stock Performance - Target is actively working to improve its performance, and there is a belief that the stock's potential for successful improvement is greater than currently priced in [10]