Home Depot's Analyst Rating Falls to "Strong Buy" as EPS Expectations Decline

Home Depot's stock has gained 9.3% over the past 52 weeks, but has underperformed the broader S&P 500 Index. The company's Q1 results showed a 9.4% YoY revenue increase, but a 3% YoY decline in adjusted EPS. Analysts expect a 1.4% YoY decline in EPS for the current fiscal year. The consensus rating is a "Strong Buy" based on 25 "Strong Buy" and one "Strong Sell" ratings.

Home Depot, Inc. (HD) has seen a mixed bag of performance in its recent quarterly results. The company reported a 9.4% year-over-year (YoY) increase in revenue for Q1 2025, driven by strong sales across its various product categories. However, the adjusted earnings per share (EPS) decreased by 3% YoY, marking a significant drop compared to the previous year's growth [3].

Despite the decline in EPS, analysts remain optimistic about Home Depot's future prospects. The consensus rating is a "Strong Buy," with 25 "Strong Buy" ratings and one "Strong Sell" rating [2]. This optimism is partly driven by the company's robust revenue growth and the expectation that it will continue to outperform the broader retail sector.

Looking at the broader market, Home Depot's stock has underperformed the S&P 500 Index over the past 52 weeks, gaining 9.3% compared to the index's 10.2% growth [2]. However, the company's stock has shown resilience, with a current price of $385.41, up 1.21% from the previous day [2].

Home Depot's forward-looking metrics also indicate a positive outlook. The company is expected to report earnings of $4.71 per share and revenue of $45.51 billion for the upcoming fiscal year, representing a 0.86% YoY increase in EPS and a 5.42% increase in revenue [2]. For the full year, the Zacks Consensus Estimates project earnings of $15.04 per share and a revenue of $164.45 billion, demonstrating changes of -1.31% and +3.09%, respectively, from the preceding year [2].

Institutional investors have also shown confidence in Home Depot's prospects. Endeavor Private Wealth Inc. grew its stake in the company by 473.2% in the first quarter, owning 1,777 shares of the stock [3]. Other large investors, such as Financial Gravity Asset Management Inc. and Wealth Management Partners LLC, have also increased their holdings in Home Depot during the same period [3].

In conclusion, while Home Depot's Q1 results showed a decline in EPS, the company's robust revenue growth and analyst optimism suggest a positive outlook for the future. The company's stock has shown resilience, and its forward-looking metrics indicate strong performance expectations. Investors should keep an eye on Home Depot's upcoming earnings report and other key indicators to assess the company's long-term prospects.

References:
[1] https://www.cnbc.com/quotes/HD
[2] https://www.nasdaq.com/articles/home-depot-hd-increases-despite-market-slip-heres-what-you-need-know
[3] https://www.marketbeat.com/instant-alerts/filing-endeavor-private-wealth-inc-grows-stake-in-the-home-depot-inc-nysehd-2025-08-02/