Home Depot Sees Higher Big Ticket Sales: Is Pro Demand Driving Growth?

The Home Depot, Inc. HD reported a rise in higher-value purchases in the fourth quarter of fiscal 2025, signaling resilience in big-ticket spending even as the broader home improvement market remains pressured. The company said transactions worth more than $1,000 grew 1.3% year over year, reflecting stronger demand for larger-ticket items even as overall transactions declined.

The increase in big ticket sales was partly driven by price increases and a shift toward higher-value products, which pushed the company’s average ticket up 2.4% during the quarter. However, the rise also highlights a gradual recovery in spending patterns, particularly among professional customers who typically undertake larger and more complex projects.

“Pro,” customers continued to outperform do-it-yourself shoppers in the fourth quarter. Home Depot noted that Pro sales posted positive comparable growth and remained strong across categories, such as gypsum, wire, concrete and plumbing — segments that are closely tied to repair, maintenance and construction activity.

Still, the company cautioned that large discretionary home improvement projects remain under pressure due to housing market headwinds and cautious consumer sentiment. High mortgage rates, limited housing turnover and broader economic uncertainty have slowed the demand for major renovation projects, even as maintenance and repair work remains relatively steady.

Home Depot believes strengthening its Pro ecosystem could support future growth. Investments in tools, such as order management systems, project planning capabilities and improved delivery reliability, are aimed at making it easier for professionals to manage projects and source materials, potentially driving higher engagement and larger transactions over time.

What the Latest Metrics Say About Home Depot

Home Depot, which competes with Floor & Decor Holdings, Inc. FND and Lowe's Companies, Inc. LOW, has seen its shares rise 2% in the past three months compared with the industry’s 0.2% growth. While shares of Floor & Decor Holdings have declined 2.9%, Lowe’s has advanced 2.8% in the same period.

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From a valuation standpoint, Home Depot trades at a forward price-to-earnings ratio of 23.55, higher than the industry’s 21.32. Home Depot is trading at a discount to Floor & Decor Holdings (with a forward 12-month P/E ratio of 27.78) but at a premium to Lowe’s (19.61).

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The Zacks Consensus Estimate for Home Depot’s current financial-year sales implies year-over-year growth of 4%, while the same for earnings per share suggests an increase of 2.6%. For the next fiscal year, the consensus estimate indicates a 4.4% rise in sales and 8.9% growth in earnings.

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Home Depot 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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This article originally published on Zacks Investment Research (zacks.com).

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