A subdued US housing market and a consumer who remains hard-pressed across the pond mean expectations are subdued ahead of second quarter earnings (13 August) from the world’s largest home improvement retailer, Home Depot (HD:NYSE).

Of late, a raft of companies have reported weaker US consumer trends, notably in lower income groups, with high interest rates crimping spending.

Guided by chief executive Ted Decker, Home Depot will be hoping the Federal Reserve duly delivers an interest rate cut in September as this should help to unfreeze the US housing market and boost spending on big discretionary DIY projects.

The group's first-quarter results (14 May) were downbeat, revealing a 2.3% year-on-year decline in overall sales to $36.4 billion including comparable sales down 2.8%, pulled lower by a 3.2% dip in US comparable sales. Home Depot also reaffirmed full year 2024 guidance for a 1% fall in comparable sales.

In a sign management expects the housing market may remain sluggish, the firm recently made a foray into the professional market through the acquisition of building products supplier SRS Distribution for an enterprise value of $18.25 billion.

This deal expands Home Depot’s reach among contractors and builders and increases its total addressable market by roughly $50 billion to approximately $1 trillion.

US UPDATES OVER THE NEXT 7 DAYS

QUARTERLY RESULTS

9 Aug: Constellation Software 

12 Aug: Barrick Gold 

13 Aug: Home Depot

14 Aug: Cisco

15 Aug: Walmart, Deere & Co

‹ Previous2024-08-08Next ›