By Savyata Mishra
Dec 9 (Reuters) – Home improvement chain Home Depot on Tuesday forecast fiscal 2026 comparable sales growth and profit below analysts’ estimates as demand for do-it-yourself projects and big-ticket items cools.
Shares of the company were down 2% in premarket trading after the retailer outlined financial targets ahead of its first investor day in more than two years.
The retailer expects same-store sales for fiscal 2026 to grow in the range of flat to 2%, below the average of analysts’ expectations of 2.34%, according to data compiled by LSEG.
It forecast adjusted earnings-per-share to be flat to 4% higher. Analysts had estimated the company’s EPS to grow 5.6%.
TD Cowen analysts view the forecast as “a reasonable starting point” that could set the ground for a recovery once momentum in housing and large projects begins to build.
Retailers such as Home Depot and Lowe’s are under pressure as Americans curb spending on costly home renovations and big-ticket projects due to higher borrowing costs.
U.S. housing demand has also been choppy due to rising unemployment and high home prices. Meanwhile, easing U.S. interest and mortgage rates had failed to aid a recovery, with the company projecting a bigger drop in fiscal 2025 profit in its latest quarterly earnings.
However, Home Depot finance chief Richard McPhail said on Tuesday expects the company to “grow faster than our market” next year.
“We believe that the pressures in housing will correct and provide the home improvement market with support for growth faster than the general economy,” McPhail said.
The company employs around 470,000 workers at its 2,356 retail stores and more than 1,200 SRS locations across all 50 states.
Its stock has shed about 10% of its value this year, compared with a 16% rise in the broader S&P 500 index.
(Reporting by Savyata Mishra in Bengaluru; Editing by Leroy Leo)
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