Barclays Expects Home Depot and Lowe's Q2 Results to Meet Consensus Estimates

Barclays expects second-quarter results for Home Depot (HD) and Lowe’s (LOW) to align with consensus estimates, supported by home improvement demand that appears to be stable to slightly improving. The investment bank noted that sales are currently running slightly positive even without significant support from the housing market.

Demand Stabilizes Despite Housing Headwinds

According to a note from Barclays, the home improvement sector is holding steady despite a "lackluster" spring for the housing market and ongoing consumer uncertainty. The firm believes that with year-over-year comparisons easing and current estimates appearing reasonable, the retailers are positioned to meet expectations.

Barclays also highlighted a key macroeconomic indicator, noting the gap between GDP and private residential fixed investment is at its widest point since the post-COVID period and the last housing recession. The performance of Home Depot and Lowe's stock has historically coincided with this metric, the bank said.

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Valuation and Stock Performance

Shares of both companies have pulled back toward their recent lows, a move Barclays attributes to recent interest rate movements and the perceived risk of further housing market deterioration. The firm suggested that this pullback creates an attractive entry point for investors, given that valuations remain appealing.

Barclays maintained its Overweight rating on both companies. For Home Depot, the bank cited progress in its professional customer segment and its relative value compared to other leaders in the sector. For Lowe’s, analysts noted that the stock trades at an attractive 15-16 times fiscal 2027 earnings estimates.