Market Overview - The Nasdaq experienced a significant drop, shedding -314 points (-1.46%), while the Dow and S&P 500 showed minor fluctuations, closing up +10 points (+0.02%) and down -37 points (-0.59%) respectively [1] - The decline in tech stocks has been a continuing trend, with Palantir (PLTR) falling -9.3% on the day and -16.5% over the past five sessions [2] Company Earnings - Toll Brothers (TOL) reported fiscal Q3 earnings of $3.73 per share, exceeding the Zacks consensus estimate of $3.59, with revenues of $2.88 billion, surpassing the projected $2.85 billion [3] - The company achieved its fourth earnings beat in the last five quarters, although gross margins remained steady at +27.5% [4] - Orders for Toll Brothers were down -4% compared to expectations of flat, and the average home sold was $974K, slightly below analyst expectations [4] Upcoming Earnings Reports - Anticipation is building for retail earnings reports from Target (TGT), TJX Stores (TJX), Lowe's (LOW), and Estee Lauder (EL), with expected year-over-year earnings changes of -18.7%, +5%, +3.2%, and -87.5% respectively [5] Federal Reserve Insights - The Federal Open Market Committee (FOMC) minutes will be released, highlighting that the Fed has maintained rates at 4.25-4.50% for the fifth consecutive meeting, with notable dissent from two voting members for the first time in over 30 years [6]

Mike, it's great to see you. So, a little bit of good, a little bit of bad here. The stock is going up.What was your read on the numbers. Yeah, the the miss was really small. Uh, you know, the same sort of sales missed by like 10 basis points and it was the best comp that they've had in about two years.A lot of the underlying metrics are showing, you know, better demand, not where we were, you know, many years ago during the pandemic, but but certainly a lot better than the post-pandemic era. And again, the ...

Core Viewpoint - Home Depot is considering raising prices on select merchandise to offset the costs associated with tariffs imposed by the Trump administration, marking a shift from its previous stance against trade-related price adjustments [1][12]. Pricing Strategy - The company indicated that price changes would be limited to specific product categories and characterized as measured rather than sweeping [1][3]. - CFO Richard McPhail confirmed that certain items would see price modifications in response to import duties [2][17]. Consumer Behavior - Home Depot reported mixed consumer behavior, with comparable store sales increasing by 1% while customer visits declined by 0.9% [4][11]. - The decline in customer visits is attributed to economic headwinds and elevated interest rates, leading homeowners to delay significant remodeling projects [3][9]. Market Dynamics - The residential real estate market's challenges have negatively impacted Home Depot's performance, as elevated property values and economic uncertainty have reduced demand for renovations [7][10]. - Despite home equity values doubling since 2019, homeowners are reluctant to take on debt for major improvement projects, even with favorable collateral values [10]. Strategic Focus - To counteract the decline in do-it-yourself demand, Home Depot is intensifying efforts to capture the professional contractor market, including expanded bulk purchasing options and enhanced support services [13][14]. - The company recently agreed to acquire building materials supplier GMS for $4.3 billion, reinforcing its commitment to serving professional builders [13][14]. Supply Chain Considerations - Approximately half of Home Depot's merchandise is sourced from domestic suppliers, which protects those products from international trade duties [4][16]. - The company aims to maintain a price leadership position in home improvement while managing the overall cost of projects for customers [17].

Core Viewpoint - Home Depot reported better-than-expected earnings, with investors showing mild optimism despite a generally weak earnings outlook for retail stocks this week [3][4]. Financial Performance - Home Depot's revenue for the second quarter was $45.28 billion, slightly below the expected $45.43 billion, while earnings per share (EPS) of $4.68 missed forecasts by 1 cent [5]. - Comparable store sales increased by 1%, marking the largest gain in nearly two years and a significant improvement from a decline of 3.3% in the same quarter last year [6]. Customer Insights - The company noted modest strength in its Do-It-Yourself (DIY) customer segment, with consumers engaging in smaller, seasonal home improvement projects, alongside strength in the Pro sales channel [7]. Guidance and Margins - Home Depot reaffirmed its guidance for the rest of the year, citing strong operating margins as a reason for optimism [8]. - Management acknowledged that while tariffs may increase prices on some products, over 50% of its products are sourced domestically and are not subject to tariffs [9]. Market Position and Economic Context - Home Depot and its competitor Lowe's are considered cyclical stocks, typically outperforming in a strong housing market but lagging in a tight market [10]. - Economic uncertainty is cited as the primary reason for consumers deferring large projects, indicating that broader investor confidence is crucial for stock performance [11]. Stock Forecast - The 12-month stock price forecast for Home Depot is $427.76, representing a 5.25% upside based on 26 analyst ratings [13]. - The stock has shown less volatility compared to larger tech stocks, maintaining a general uptrend since June [13]. - Technical indicators suggest that while the stock appears strong in the near term, it may be entering overbought territory [14][15]. Technical Analysis - Key near-term support levels are identified at around $400 and $391, with immediate resistance at the $409-$410 level [16]. - The stock is currently trading at approximately 26 times forward earnings, slightly above the sector average and its historical average [15].

Back in June, I expressed my view that The Home Depot, Inc. (NYSE: HD ) was unlikely to go anywhere anytime soon. I initiated the stock at a Hold rating, citing an unfavorable outlookI'm a full-time investor with a strong focus on the tech sector. I graduated with a Bachelor of Commerce Degree with Distinction, major in Finance. I'm also a proud lifetime member of the Beta Gamma Sigma International Business Honor Society. My core values are: Excellence, Integrity, Transparency, & Respect. I always, to the b ...

Key Takeaways HD posted Q2 sales of $45.3B, up 4.9% y/y but fell short of estimates.Comparable sales rose 1%, driven by 1.4% growth in the U.S., offset by FX headwinds.Management reaffirmed the FY25 outlook, expecting 2.8% sales growth and an adjusted operating margin of 13.4%.The Home Depot Inc. (HD) has reported second-quarter fiscal 2025 results, wherein both the sales and earnings missed the Zacks Consensus Estimate. However, both metrics improved year over year. Also, comparable sales increased year ov ...

Shares of Home Depot Inc HD were climbing in early trading on Tuesday, after the company reported second- quarter results. Here are some key analyst takeaways. Check out other analyst stock ratings. DA Davidson: Home Depot's comps grew by 1.0%, just below consensus of 1.1% but representing a strong acceleration versus the previous quarter's 0.3% decline, Baker said in a note. Comps were hurt by currency exchange rates, he added. Loading... Read More: The comps growth was the first increase since the first q ...

Housing Market Insights - Housing Starts for July reached 1.43 million seasonally adjusted, annualized units, significantly exceeding the projected 1.29 million and the revised 1.36 million from the previous month, marking the highest level since February and the third-best month in the past year [2] - Building Permits fell to 1.35 million, below the expected 1.39 million and the downwardly revised 1.39 million from the prior month, indicating a fourth consecutive monthly decline, reminiscent of levels seen during the Covid pandemic [3] Multi-family vs. Single-family Housing - Multi-family housing saw a substantial increase of +11.6% month over month and +27% year over year, suggesting strong demand for apartment and condo living despite high supply [4] - Single-family housing growth was positive but lagged behind multi-family, with increases of +2.8% month over month and +8% year over year, impacted by high mortgage rates keeping potential buyers sidelined [5] Home Depot Performance - Home Depot reported Q2 earnings of $4.68 per share, missing expectations by 3 cents, resulting in a -0.64% earnings surprise, marking the second consecutive earnings miss [6] - Revenues for the quarter were $45.38 billion, slightly missing expectations by -0.5%, but still reflecting a nearly +5% year-over-year increase; the company maintained its fiscal year guidance, contributing to a +1.6% rise in stock price during early trading [7] Upcoming Market Events - Fed Vice Chair Michelle Bowman, a proponent of a 25 basis point interest rate cut, is scheduled for appearances today, ahead of the release of the FOMC meeting minutes, which may provide insights into potential future rate cuts [8] - Luxury homebuilder Toll Brothers is set to report fiscal Q3 earnings, with estimates indicating a slight year-over-year decline in earnings (-0.28%) but a revenue increase of +4.56% compared to the previous year [9]

Core Insights - Home Depot is focusing on professional builders to drive growth, as they spend more per project and are less affected by consumer sentiment compared to DIY customers [2][4][6] - The U.S. pro builder market is estimated to be over $450 billion annually, allowing for sustainable growth even with modest market share gains [1][7] Strategy and Market Positioning - Home Depot's strategy includes enhancing its supply chain with digital platforms, AI logistics, credit options, and loyalty programs like Pro Xtra to attract contractors [1][12] - The company aims to position itself as a distribution partner rather than just a retailer, competing with specialty wholesalers [10] Competitive Advantages - The acquisition of SRS Distribution for $18.3 billion enhances Home Depot's presence in roofing, landscaping, and specialty building supplies, providing breadth and depth in product offerings [8] - The integration of SRS allows for faster fulfillment and better relationship building with contractors, leveraging industry veterans to foster trust [9] Technology and Services - Home Depot is utilizing technology to streamline B2B operations, with initiatives like pro-specific digital platforms for bulk orders and AI-powered delivery scheduling [11][12] - The company is expanding its service offerings beyond products to include financing, training, and workforce development support for contractors [12][13]

Tuesday, August 19, 2025Homebuilding news takes center stage this morning — in fact, this week has important housing data all through it — with Housing Starts and Building Permits for July pointing in two distinctly different directions. Pre-market futures were already showing some improvement from overnight lows, but have pointed north on the new data.Housing Starts, Building Permits Point to Big DifferencesLast month, Housing Starts came in at multi-month highs to 1.43 million seasonally adjusted, annuali ...