Home Depot Q1 Earnings Preview: 'Well Positioned For Share Gains' — Will Consumers Doing Home Repairs Over Buying Homes Help?

Home improvement retailer Home Depot Inc HD reports first-quarter financial results before market open Tuesday May 14, 2024.

Here are the key earnings estimates, what analysts are saying and items to watch.

Earnings Estimates: Analysts expect Home Depot to report first-quarter revenue of $36.68 billion according to estimates from Benzinga Pro.

The estimated revenue would represent a year-over-year decline from the $37.26 billion reported in last year's first quarter. The company has beaten revenue estimates from analysts in eight of the past 10 quarters.

Analysts expect the company to report earnings per share of $3.60, down from $3.82 reported in last year's first quarter. The company has beaten earnings per share in each of the past 10 quarters.

Guidance from the company calls for full-year revenue to be $154.2 billion, up around 1% year-over-year. Full-year earnings per share are also expected to rise around 1% year-over-year to $15.26.

What Analysts Are Saying: Home Depot could be "well positioned for share gains," Bank of America analyst Robert Ohmes said in a new investor note.

The analyst, who has a Buy rating and $425 price target, said gross margin expansion in 2024 could help offset expense deleverage.

"While the macro remains choppy, and we expect continued pressure in 2024 on discretionary and big ticket, we expect HD to see continued share gains as it accelerates growth and capabilities with the complex pro, both organically and inorganically," Ohmes said.

The analyst said Home Depot has stronger exposure to professional customers than rival Lowe's Companies LOW.  

Here are other recent analyst ratings on Home Depot and their respective price targets:

Wedbush: Outperform rating, $410 price target

Wells Fargo: Overweight rating, lowered price target from $425 to $400

Citigroup: Buy rating, lowered price target from $415 to $395

Telsey: Market Perform rating, $360 price target

Truist: Buy rating, $417 price target

Evercore ISI Group: Outperform rating, lowered price target from $420 to $415

Guggeheim: Buy rating, $390 price target

Related Link: How To Earn $500 A Month From Home Depot Stock Ahead Of Q1 Earnings

Key Items to Watch: Home Depot's quarterly report could provide a look at how the home Improvement market is fairing.

With more people choosing to do home repairs instead of looking to buy a house with high interest rates, Home Depot could be a beneficiary. Home Depot could benefit from new home builds, but home repairs likely provide a larger opportunity with its growth in professional sales.

Any discussion on the growth of smart home items and artificial intelligence use cases could also be widely watched by investors and analysts in the report.

The company's quarterly report comes ahead of rival Lowe's reporting on May 24.

Home Depot shares are up more over the last year (+18.8%) compared to Lowes's (+14.0%), but trail the year-to-date return in 2024 at -1% compared to +4.8% for Lowe's.

HD Price Action: Home Depot shares trade on Monday at $341.69 versus a 52-week trading range of $274.26 to $396.87.

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