Home Depot (HD) Stock Outlook: Q3 2025 Earnings, 2026 Guidance and Wall Street Forecasts After the November Slide

Updated December 11, 2025 — Ticker: NYSE: HD

Home Depot, Inc. (HD) is ending 2025 in a tricky spot: the housing market is soft, do‑it‑yourself demand is sluggish, but the company is still investing heavily in its “pro” customer, supply chain, and long‑term growth.

Since November 21, 2025, a wave of earnings reports, cautious guidance, and analyst revisions has reshaped the outlook for Home Depot stock. Here’s a detailed look at what’s changed, what Wall Street expects next, and how the risk–reward profile of HD is evolving.

Home Depot stock today: still below its highs

As of the afternoon of December 11, 2025, Home Depot shares trade around $361.

The stock is roughly 16% below its 52‑week high near $428, set in December 2024. ^[1]
On December 10, HD closed at $351.13, up 1.7% on the day, with volume well above its 50‑day average — but still about 18% below that 52‑week peak. ^[2]
Reuters notes that, as of December 9, Home Depot stock had shed around 10% year‑to‑date, compared with a 16% gain in the S&P 500. ^[3]

Earlier in November, coverage from MarketWatch and other outlets put the year‑to‑date decline closer to 14%, versus low‑teens gains for the broader market. ^[4]

In short: HD has lagged the index all year and remains notably below its highs, even after a recent bounce.

Q3 2025 earnings: modest sales growth, pressured profits

The current narrative around Home Depot stock really began with third‑quarter fiscal 2025 results, reported on November 18, 2025. ^[5]

Key numbers for Q3 (quarter ended November 2, 2025): ^[6]

Net sales: $41.4 billion, up 2.8% year over year (from $40.2 billion).
About $900 million of that increase came from the newly acquired GMS Inc., reflecting roughly eight weeks of GMS sales in the quarter.
Comparable sales: up 0.2% overall; U.S. comps up 0.1%.
Net earnings: $3.6 billion, essentially flat versus a year earlier.
GAAP diluted EPS:$3.62, down from $3.67.
Adjusted diluted EPS:$3.74, down from $3.78.

Management was blunt about why results missed internal expectations:

The quarter lacked the usual storm‑driven demand that often boosts traffic and big‑ticket repairs.
Expected demand in some categories “did not materialize”.
The company highlighted consumer uncertainty and continued pressure in housing as key headwinds to home‑improvement spending. ^[7]

Several outlets, including MarketWatch, CNN‑linked coverage, and Entrepreneur, framed Q3’s weakness as a warning sign that both housing and the broader consumer backdrop remain fragile. ^[8]

2025 guidance updated in November — then reaffirmed in December

Alongside Q3 earnings, Home Depot updated its fiscal 2025 guidance, which runs on a 52‑week year versus a 53‑week year in 2024: ^[9]

Total sales growth: about 3% (with GMS contributing roughly $2 billion).
Comparable sales: “slightly positive” for the comparable 52‑week period.
Gross margin: ~33.2%.
Operating margin: ~12.6% (adjusted ~13.0%).
Tax rate: ~24.5%.
Net interest expense: about $2.3 billion.
Diluted EPS: expected to decline ~6% from $14.91 in fiscal 2024.
Adjusted diluted EPS: expected to decline ~5% from $15.24 in 2024.

Fast Company and other outlets emphasized that Home Depot now expects adjusted 2025 earnings to fall about 5%, versus a prior forecast of only a 2% decline — a meaningful downgrade in profit expectations. ^[10]

Despite that downgrade, Home Depot reaffirmed this 2025 guidance at its Investor & Analyst Conference on December 9, signaling that management believes the worst of the forecast cuts is behind it for this fiscal year. ^[11]

December 9 Investor Day: a cautious 2026 and a “market recovery case”

The company’s first investor day in more than two years, held on December 9, 2025, was the biggest catalyst for HD since Q3 earnings.

From Home Depot’s own release and major financial press coverage (Reuters, The Wall Street Journal, Barron’s), the picture is clear: near‑term caution, long‑term confidence. ^[12]

Baseline 2026 outlook

For fiscal 2026, Home Depot’s preliminary outlook calls for: ^[13]

Home‑improvement market growth: between ‑1% and +1%.
Comparable sales growth: roughly flat to +2%.
Total sales growth:2.5% to 4.5%.
Operating margin: about 12.4% to 12.6% (adjusted 12.8% to 13.0%).
Diluted EPS growth:flat to +4%, with adjusted EPS in the same range.

Analysts had generally expected stronger 2026 growth, especially for earnings. Reuters notes that consensus EPS growth expectations were around 5.6%, ahead of management’s flat‑to‑4% range, and comparable sales expectations were also slightly higher than management’s 0% to 2% guide. ^[14]

Market recovery and accelerated recovery scenarios

Home Depot also laid out a “Market Recovery Case” for when housing and big‑project demand eventually normalize: ^[15]

Total sales growth:5% to 6%.
Comparable sales growth:4% to 5%.
EPS growth:mid‑ to high‑single digits, faster than sales thanks to operating leverage.

Management went further, mentioning an “Accelerated Recovery Case” in which a sharper housing rebound could push sales and EPS growth even higher than those market‑recovery ranges. ^[16]

Still, executives repeatedly stressed that no clear catalyst for a housing rebound has appeared yet. CFO Richard McPhail warned that housing activity remains “choppy” and that pressure on consumer spending and large‑ticket projects is expected to persist into 2026. ^[17]

The cautious tone triggered an immediate market reaction:

Reuters and the Wall Street Journal both reported that HD shares fell around 2–2.5% in pre‑market trading following the 2026 outlook, even though 2025 guidance was reaffirmed. ^[18]

Analyst rating changes and price targets since November 21, 2025

From November 21 onward, Wall Street analysts have been busy revising their models and price targets.

Recent target cuts and “Hold” tones

Data from Quiver Quantitative, TickerNerd and GuruFocus shows a wave of mostly positive but slightly more cautious rating actions: ^[19]

December 10, 2025 (post–Investor Day)
- RBC Capital (Steven Shemesh): new $366 price target; rating “Sector Perform”. ^[20]
- Piper Sandler (Peter Keith): target $441, rating Overweight/Outperform. ^[21]
- Telsey Advisory Group (Joseph Feldman): target $410, rating Outperform. ^[22]
- Wells Fargo (Zachary Fadem): trimmed target from $400 to $395, keeping “Overweight”. ^[23]
December 5, 2025
- Oppenheimer (Timothy Horan): target $405, rating Perform. ^[24]
December 1, 2025
- Stifel (W. Andrew Carter): target $350, rating Hold. ^[25]

Post‑earnings cluster on November 18–21

Immediately after Q3 earnings and into November 21, multiple firms tightened targets but stayed constructive: ^[26]

Citigroup (Steven Zaccone): maintained “Buy”, but cut target from $422 to $407 on November 21.
Evercore ISI (Greg Melich):$425, rating Outperform.
UBS (Michael Lasser):$445, rating Buy.
DA Davidson (Michael Baker):$430–$475, rating Buy across multiple notes.
Telsey Advisory Group: targets in the $430–$455 zone with Outperform ratings.
Wells Fargo, Morgan Stanley, BofA, Baird: targets largely in the high‑$300s to mid‑$400s, mostly with Overweight/Outperform/Buy labels.

GuruFocus summarises that 34 analysts currently have an average one‑year HD target near $400, with a high in the mid‑$460s and a low around $300, implying low‑teens upside from the mid‑$350s price region. ^[27]

Overall tone: analysts still mostly like Home Depot, but many have trimmed their price targets and several now sit at Hold or Perform, especially after the more subdued 2026 outlook.

Consensus forecasts and valuation: upside, but not everyone is convinced

Different data providers arrive at slightly different numbers, but the story is consistent:

MarketBeat: average 12‑month HD price target around $401, with a range roughly $320–$470, implying about 12% upside from a recent price near $357. ^[28]
TickerNerd: median target about $407 from 39 Wall Street analysts, with no formal “Sell” ratings and a tilt toward Buy. ^[29]
GuruFocus: average target close to $399.5, based on 34 analyst one‑year forecasts, implying around 13–14% upside from prices in the mid‑$350s. ^[30]

On the flip side, valuation‑focused analysts are more skeptical:

Simply Wall St published a discounted cash‑flow view on December 10 that suggests Home Depot may be about 16–17% overvalued versus its estimate of fair value. ^[31]

With projected 2025 EPS expected to fall roughly 6% from 2024’s $14.91, management’s guidance implies forward earnings around $14 per share. ^[32] At a share price near $361, that works out to a mid‑20s price‑to‑earnings (P/E) multiple on what is effectively shrinking earnings this year and low‑single‑digit growth next year — a valuation that some investors see as demanding.

Dividend profile: a key part of the HD story

Even in a slower growth phase, Home Depot continues to lean on its dividend as a core attraction for shareholders:

The board has held the quarterly dividend at $2.30 per share, which equates to an annual payout of $9.20. ^[33]
At recent share prices, that represents a dividend yield of roughly 2.5%–2.7%. ^[34]
The company has now notched more than 150 consecutive quarterly dividend payments and around 15–16 consecutive years of dividend increases, after a 2.2% raise early in 2025. ^[35]

For income‑oriented investors, that steady, growing dividend helps offset some of the volatility in the share price and can make the stock more palatable even if capital gains are muted in the short term.

Strategic positioning: pro customer, acquisitions, and brand strength

Despite the near‑term slowdown, Home Depot is still leaning hard into what it sees as its long‑term advantages:

Huge addressable market
- Management pegs its total addressable home‑improvement and construction market at roughly $1.1 trillion, and believes it can continue to gain share within that space even in a slow macro environment. ^[36]
Pro customer and acquisitions (SRS, GMS)
- Prior deals (Interline, HD Supply) and more recent acquisitions like SRS Distribution and GMS are designed to deepen Home Depot’s reach with professional contractors across categories such as roofing, landscaping, pools, and building materials. ^[37]
- GMS alone contributed approximately $900 million of Q3 2025 sales, and management expects both SRS and GMS to be significant growth drivers as integration progresses. ^[38]
Interconnected retail and supply chain investments
- The company repeatedly highlights its strategy to “drive core and culture, deliver a frictionless interconnected experience, and win the pro”, with heavy investments in digital, logistics and store productivity. ^[39]
Brand, community and ESG positioning
- Corporate updates like “The Home Depot Wrapped 2025: A Year of Building Good” showcase ongoing investment in trades training, sustainability, disaster relief, and veterans’ housing — efforts that can strengthen employee engagement and brand loyalty over time. ^[40]

Barron’s coverage from Investor Day also notes that Home Depot plans to open up to 20 new stores annually starting in 2027 and to continue “tuck‑in” acquisitions, suggesting management still sees ample room for expansion even after years of growth. ^[41]

The bull case vs. the bear case for HD stock right now

Bull case: high‑quality franchise waiting for a housing upturn

Supporters of Home Depot stock tend to emphasize:

Best‑in‑class brand and scale in home improvement retail.
A growing “pro” ecosystem supported by SRS, GMS, and HD Supply, which may benefit disproportionately when construction and renovation cycles recover. ^[42]
Management’s belief that home‑improvement demand will ultimately grow faster than the broader economy once housing pressures normalize. ^[43]
A solid dividend with a long history of increases, plus ongoing share repurchases over time. ^[44]
Consensus price targets implying low‑ to mid‑teens upside over the next 12 months, assuming the macro picture doesn’t deteriorate further. ^[45]

Many commentary pieces (including some highlighting how “Home Depot stock can recover in 2026”) frame the current weakness as a cyclical downturn rather than a structural problem with the business. ^[46]

Bear case: slow growth, premium multiple

Skeptics point to several issues:

Growth deceleration:
- 2025 adjusted EPS is expected to decline ~5%, and 2026 guidance calls for only 0–4% EPS growth. That’s a far cry from Home Depot’s historic high‑teens growth phases. ^[47]
Macro headwinds:
- High mortgage rates, elevated home prices, and soft DIY demand are weighing on traffic and big‑ticket projects, and management openly acknowledges it does not yet see a catalyst for a meaningful housing rebound. ^[48]
Valuation concerns:
- With the stock trading at a mid‑20s P/E on depressed but not dramatically cheap earnings, some valuation models (like Simply Wall St’s DCF) argue that HD may be overvalued by around 15–20%. ^[49]
Competitive and mix risk:
- Consumers can delay projects, trade down in quality, or shift spend online and toward competitors such as Lowe’s or Amazon, potentially pressuring margins further if Home Depot has to discount to maintain share. ^[50]

In this view, HD is a great company at a merely “okay” price, vulnerable to multiple compression if the macro backdrop worsens or the recovery drags beyond 2026.

What to watch next

For investors tracking Home Depot stock into 2026, key catalysts include:

Q4 and full‑year 2025 results
- Confirmation of the ~3% sales growth / ~5–6% EPS drop scenario will show whether guidance was conservative or still optimistic. ^[51]
Updates to 2026 guidance
- Any revision — up or down — to the flat‑to‑2% comps and flat‑to‑4% EPS growth outlook will be closely watched, especially if housing data improves or weakens further. ^[52]
Housing and rate environment
- Signs of lower mortgage rates, improved buyer activity, or stronger remodeling demand could support Home Depot’s “market recovery” scenario (5–6% sales growth and mid‑ to high‑single‑digit EPS growth). ^[53]
Integration progress for SRS and GMS
- Evidence that these acquisitions are delivering synergies and incremental pro‑customer share gains could support the bull case even if DIY demand stays muted. ^[54]
Dividend and capital‑return policy
- With a payout ratio around the low‑60% range and a long track record of increases, any changes to buybacks or dividend growth will send a strong signal about management’s confidence. ^[55]

Bottom line

Since November 21, 2025, the story of Home Depot stock has solidified into a clear trade‑off:

Pros: world‑class franchise, expanding pro ecosystem, healthy dividend, and consensus price targets that still sit noticeably above the current share price.
Cons: sluggish near‑term growth, persistent housing and consumer headwinds, and a valuation that already prices in a decent recovery.

For investors, HD now looks like a high‑quality, late‑cycle retail play: one that may reward patience if housing and big‑ticket projects rebound, but that could remain range‑bound — or rerate lower — if the “recovery case” takes longer than management hopes.