Dow Jones Forecast: Home Depot Drops Pre-Market — What Traders Should Watch Today

Home Depot Holds Forecast Despite Miss; Investors Focus on Margins, Pro Segment

Home Depot reaffirmed its full-year forecast Tuesday despite missing Wall Street’s earnings and revenue expectations for the second straight quarter. While the results came in just a hair short, the broader takeaway is that the retailer is holding its ground in a tough housing environment. Traders are watching closely as shares trade lower pre-market, down about 1.8% to $387.53.

Mixed Quarter, But Positive Sales Momentum

The fiscal Q2 print showed adjusted earnings per share of $4.68 vs. $4.71 expected, with revenue at $45.28 billion, just shy of the $45.36 billion forecast. Still, revenue rose nearly 5% from the same quarter last year. Comparable sales were up 1% globally and 1.4% in the U.S., marking only the second year-over-year gain in the last 11 quarters. July stood out, with comps up 3.3%, suggesting some late-quarter strength. That being said, this marks the first time since 2014 that Home Depot has missed both earnings and revenue in a quarter — not a great stat for the bulls.

DIY Slowdown Persists, Pros Pick Up Slack

The homeowner “deferral mindset” is still in play — folks are holding off on big projects unless there’s a compelling reason to move. But look, there’s a clear shift in strategy: Home Depot is betting big on the pro segment. Between the $18.25 billion SRS Distribution deal and the upcoming $4.3 billion GMS acquisition, the company is doubling down on trade professionals. According to CFO Richard McPhail, pros now make up 55% of sales, which could help insulate the company from softness in the DIY crowd.

Margins in Focus as Traffic Slips

Customer transactions dropped to 446.8 million from 451 million last year, but the average ticket rose to $90.01. That suggests pricing power is holding up for now, and the company isn’t feeling pressure to pass on new tariffs to consumers — at least yet. Most imports landed before new duties hit, and Home Depot hasn’t changed its pricing stance. But if tariff talks stall, the market will want to see how much cost pressure starts to bleed into margin guidance.

Technical Picture and Short-Term Outlook

Technically, HD stock is pulling back toward support around $382.92–376.81. The first level is the 200-day moving average. The second target is the mid-point of the June to August range. If this area breaks, next support sits near the 100-day moving average closer to $372.30.

On the upside, resistance sits back near $402.79-407.82. More likely than not, we’ll see the stock continue to consolidate as investors digest the mixed results and assess how much of the pro-side optimism is already priced in.

Bottom Line

Home Depot’s strategy is sound — lean on the pros while the housing market stays quiet — but earnings misses don’t inspire confidence, especially with shares already up modestly this year. With comps turning slightly positive and big-ticket sales improving, bulls may look at pullbacks as potential buying opportunities. But again, until we see real movement in housing or mortgage rates, upside could be limited.

More Information in our Economic Calendar.