Home Depot reaffirms 2025 guidance; gives early view of 2026

Home Depot has reaffirmed its guidance for fiscal year 2025, expecting a 5% decline in adjusted diluted EPS while projecting a 3% increase in total sales for the year.

For fiscal year 2026, the retailer anticipates adjusted diluted EPS to be flat or increase up to 4%, with total sales growth expected to be between 2.5% and 4.5%, slightly below industry estimates.

Home Depot outlined a market recovery scenario where total sales could rise by 5% to 6% and EPS might see mid-to-high single-digit growth if housing activity improves, reflecting confidence in future market conditions.

Despite the positive outlook, shares of Home Depot dropped by 1.1% in premarket trading, indicating some market skepticism.

Recommendation Rating: Strong Performance Anticipated

Home Depot (HD) has reaffirmed its guidance for fiscal year 2025 and presented an initial outlook for 2026.

The leading home improvement retailer anticipates a decline of approximately 5% in adjusted diluted earnings per share (EPS), predicting a decrease from $15.24 in fiscal 2024. However, total sales are expected to grow by roughly 3%. Comparable sales growth is projected to remain slightly positive within the same 52-week comparison period.

Looking ahead to fiscal 2026, Home Depot has provided a preliminary forecast, estimating adjusted diluted EPS to experience a modest increase of either flat or up to 4%, slightly below the Bloomberg consensus estimate of around 5%. Moreover, total sales growth is anticipated to fall between 2.5% and 4.5%, compared to an industry estimate of about 5% growth. Comparable sales are projected to stabilize, with growth expected to be flat to nearly 2%, aligning with an estimate of 2.1%.