Gordon Haskett has shifted its rating on $HD from “Buy” to “Hold,” citing growing pressure from elevated interest rates. These rates are discouraging homeowners from starting large remodeling projects—once a significant revenue stream for Home Depot. As mortgage rates remain sticky, consumers are clearly thinking twice before tackling big home improvements.
🔸 Despite the downgrade, $HD delivered a solid fourth-quarter performance. The company reported net income of $3.03 billion, or $3.02 per share, up from $2.8 billion the year before. Revenue jumped 14.1% to $39.7 billion, and same-store sales managed to eke out a 0.8% increase—breaking a streak of eight consecutive quarters in the red.
🔸 In a nod to shareholders, Home Depot boosted its quarterly dividend by 2.2% to $2.30 per share. That marks the 152nd straight quarter of dividend payments—a serious show of consistency and financial strength.
🔸 Looking ahead, $HD is guiding for a 2.8% increase in total sales and a modest 1.0% rise in comparable sales for fiscal 2025. However, it also expects a 2% drop in adjusted earnings per share, reflecting the headwinds still facing the home improvement sector.
🔸 While the downgrade points to macroeconomic concerns, Home Depot continues to deliver on fundamentals. Its reliable dividend and strong financials keep it attractive for income-focused investors—even if short-term growth looks a bit more muted.