Home Depot to Acquire Mingledorff's, Expand Into HVAC Market

The Home Depot, Inc. HD, through its subsidiary SRS Distribution Inc., entered into a definitive agreement to acquire Mingledorff's, Inc., a well-established wholesale distributor of heating, ventilation and air conditioning (HVAC) equipment, parts and supplies. Mingledorff’s operates a network of 42 locations across five southeastern U.S. states and serves both residential and commercial customer segments.

This acquisition represents a strategic step forward for Home Depot as it continues to enhance its value proposition for Pro customers. SRS has already developed a strong position in specialty trade distribution, with exposure to roofing, interior and construction materials, landscaping products and pool supplies. By bringing Mingledorff’s into the portfolio, the company is entering HVAC distribution as a new vertical, significantly expanding its capabilities and service offerings.

Mingledorff’s contributes a robust distribution infrastructure, a broad and diversified product portfolio and long-standing customer relationships. These attributes are highly complementary to SRS’ existing platform. They are expected to strengthen the combined entity’s ability to capture greater market share within the fragmented building materials distribution industry. HVAC distribution alone is estimated to represent a $100 billion addressable market. This addition meaningfully expands the total addressable market for Home Depot to approximately $1.2 trillion.

Home Depot identified SRS as a critical growth engine and noted that the acquisition will support greater innovation and deeper engagement with its Pro customer base. SRS emphasized that the addition of HVAC distribution enhances its ability to provide a comprehensive, single-source solution across multiple product categories. Following the completion of the transaction, Mingledorff’s will continue to operate under its current leadership team within the SRS organization. The deal is expected to be closed in the second quarter of fiscal 2026.

How Do Lowe’s & Floor & Decor Fare?

Lowe's Companies, Inc. LOW in the fourth quarter of 2025, reported quarterly total sales of $20.6 billion, an increase from $18.6 billion in the prior-year quarter. Comparable sales for Lowe’s rose 1.3%, driven by continued growth across Pro, online and home services segments, along with strong holiday performance, reflecting steady demand and operational momentum.

Floor & Decor Holdings, Inc. FND reported fourth-quarter 2025 net sales of $1,129.7 million, reflecting a 2% increase from $1,107.4 million in the same period of fiscal 2024. However, Floor & Decor’s comparable store sales declined 4.8%, reflecting pressure from softness in existing home sales activity and a shift toward smaller flooring projects, indicating mixed performance during the quarter.

The Zacks Rundown for HD

HD’s shares have lost 8.6% over the past year compared with the industry’s 14.6% decline. HD currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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From a valuation standpoint, HD trades at a forward price-to-earnings ratio of 24.43X, higher than the industry’s average 21.79X.

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The Zacks Consensus Estimate for HD’s current and next fiscal year earnings implies year-over-year growth of 2.3% and 8.8%, respectively.

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