These days, when Home Depot reports earnings, it’s less about mulch and 2x4s… and more like a national mood ring for the economy. Everyone crowds around like it’s the Super Bowl of consumer spending, asking, “So… are we broke yet, or just pretending we’re not?” And this quarter, let’s just say the crowd got excited for a second... then read the fine print and slowly backed away.

Because while HD’s revenue jumped a beefy 9.4% year over year to $39.86 billion, the profit fairy didn’t show up. Earnings per share came in at $3.45, missing expectations of $3.59. And yes, for anyone keeping score at home, that’s a 4.95% drop from last year. On top of that, same-store sales fell 0.3%. So definitely not the rebound Wall Street was hoping for either. Let’s start with the obvious: the housing market is still limping like it just tried CrossFit for the first time. If you’ve been waiting for Jerome Powell to give you a break or for prices to magically correct… go touch some grass. Or better yet, touch a mortgage application and see how fast your soul leaves your body. 

Existing home sales just hit their slowest pace for a March since 2009 (back when everyone was still using BlackBerrys and pretending the financial system was just fine). Mortgage rates are still hanging out in “I’ll just rent forever” territory. And according to Bank of America, single-family housing starts are expected to keep declining as 30-year mortgage rates hover near 7%, inventory of unsold new homes remains elevated, and buyers everywhere are looking at $500,000 starter homes on Zillow like, “Yeah, I’m good with this black mold riddled apartment for now.”

And that’s a problem for Home Depot. When people aren’t moving, they’re not renovating. They’re not knocking down walls or redoing kitchens. They're Googling “how to reseal grout yourself” while yelling at their dog for drinking out of the toilet again (not a lot of “doers getting stuff done”). Even pros are feeling it, though that’s one area Home Depot has been leaning into hard. The $18.25 billion acquisition of SRS Distribution last year gave them a shot in the arm with contractors and specialists. That deal helped juice Q1 revenue, with about $2.6 billion of that YoY gain coming from SRS. Still, consumers are treading lightly. 

CFO Richard McPhail said customers are opting for smaller projects… think replacing a faucet, not a full bathroom remodel. And while HD threw a solid Spring Black Friday bash (because apparently that's a thing now), the big-ticket categories like countertops and bath? They didn’t sell.

\And then there’s the tariff thing. Trump’s latest trade war remix has retailers on edge, but Home Depot insists it’s chill. McPhail announced they’re not raising prices… thanks to domestic sourcing and global diversification. So they planned ahead, which is pretty impressive.

In fact, over half of what they sell is made in the U.S., and no single foreign country will represent more than 10% of their sourcing by next year. So while Walmart’s out here warning about sticker shock for the 10th time, Home Depot’s controlling what they can control. That’s why even with their profit calling in sick for the quarter… shares are currently up 2%. Even though profits dipped, the company reaffirmed its full-year forecast of 2.8% sales growth and 1% same-store sales growth. So technically, this wasn’t a disaster.

 

With all that said, the Home Depot turnaround isn’t here yet. The stock is still down around 2% year-to-date, trailing the S&P 500. And until the housing market stops looking like a kid who just dropped their ice cream cone, those dreams of booming renovation demand are just that… dreams.

Bottom line, Home Depot isn’t in trouble, but it’s not exactly thriving either. For now, it’s more mulch and lightbulbs… less marble countertops and $40,000 kitchen glow-ups.

PS: It’s a mess out there.

One day the market’s ripping, the next day it’s Black Monday all over again. Recent earning’s reports have been a total coin flip. One stock beats and explodes 30%… the next misses by a penny and gets sent to the Shadow Realm. And through it all, everyone’s begging for Jerome Powell to finally cave and cut rates.

But underneath all the panic headlines (“Inflation too sticky!” “Recession imminent!” “Tariffs round 4 incoming!”) something wild is happening…

We’re seeing violent price action. Especially in the small-cap space, where low floats and high anxiety are creating the perfect recipe for 100%+ pops before lunchtime. Some of these names are moving 200%+ in under 24 hours… and to our knowledge, NO ONE else is covering them.

Except us.

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Stock.News does not have positions in companies mentioned.