Home Depot shares went up before the market opened on Tuesday after the company’s second-quarter earnings beat expectations. The results were helped by steady demand for smaller renovation projects.
The company reported adjusted earnings of $4.92 per share, beating the $4.73 analysts expected. Sales increased 5.6% to $47.9 billion, above the $47.2 billion estimate. Chief financial officer Richard McPhail said demand was strong across the business as customers kept working on smaller home improvement projects.
Home Depot kept its outlook for fiscal 2026, expecting sales to grow between 2.5% and 4.5% and adjusted earnings per share of $14.69. This suggests earnings could be flat or rise by up to 4%. Shares were up 1.5% before the market opened, but the stock was still slightly down for the year as of Monday’s close.
Expectations for the report were low because home-improvement retailers have faced challenges in a slow housing market. Home Depot shares were down a bit for the year and had dropped more over the past 12 months. Fewer Americans are moving due to a housing affordability crisis, which has hurt major home-improvement spending. Store visits also fell in the second quarter. Investors were even more cautious after the company said its chief executive is taking medical leave.
Before the report, analysts expected only small earnings growth and revenue of $47.2 billion. Still, the stock’s valuation had dropped after its weak performance. Just over half of analysts remained positive on the shares, and average price targets suggested there could be solid gains from current levels.
Home Depot’s latest results follow a better-than-expected first quarter, which suggests the company could keep meeting or beating expectations if it keeps performing well. If the housing market slowly recovers, it could also help boost confidence in the stock and the industry.
