Home Depot (HD) shares soared 3.4% in the last trading session to close at $295.47. The move was backed by solid volume with far more shares changing hands than in a normal session. This compares to the stock's 8% loss over the past four weeks.
Home Depot’s stock rally reflects investor confidence in its strong business fundamentals, supported by strategic investments in its interconnected retail model, digital capabilities, product innovation and Pro-focused initiatives. Seamless integration across physical stores, online platforms and supply chain operations is enhancing customer convenience, improving fulfillment efficiency and driving greater engagement.
The Pro business remains a key growth driver, benefiting from targeted investments in specialized services, delivery capabilities and an expanding product assortment. SRS Distribution continues to strengthen Home Depot’s Pro ecosystem, while the Mingledorff’s acquisition expands its presence in the HVAC market and creates additional cross-selling opportunities. Meanwhile, healthy cash generation supports ongoing investments in growth initiatives and shareholder returns through dividends. These strategic efforts are expected to strengthen customer loyalty, drive market share gains and reinforce Home Depot’s long-term growth prospects.
This home-improvement retailer is expected to post quarterly earnings of $3.86 per share in its upcoming report, which represents a year-over-year change of +3.2%. Revenues are expected to be $42.72 billion, up 3.3% from the year-ago quarter.
Earnings and revenue growth expectations certainly give a good sense of the potential strength in a stock, but empirical research shows that trends in earnings estimate revisions are strongly correlated with near-term stock price movements.
For Home Depot, the consensus EPS estimate for the quarter has been revised marginally lower over the last 30 days to the current level. And a negative trend in earnings estimate revisions doesn't usually translate into price appreciation. So, make sure to keep an eye on HD going forward to see if this recent jump can turn into more strength down the road.
The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>
Home Depot is a member of the Zacks Retail - Home Furnishings industry. One other stock in the same industry, Lowe's (LOW), finished the last trading session 4% higher at $188.85. LOW has returned -8.6% over the past month.
Lowe's' consensus EPS estimate for the upcoming report has changed -0.7% over the past month to $2.86. Compared to the company's year-ago EPS, this represents a change of -6.5%. Lowe's currently boasts a Zacks Rank of #4 (Sell).
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The Home Depot, Inc. (HD): Free Stock Analysis Report
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This article originally published on Zacks Investment Research (zacks.com).