DIY delay: Home Depot warns consumers are waiting for better interest rates

Home Depot (NYSE:HD) fell slightly on Tuesday after the company’s earnings call tamped down some initial investor excitement about the consensus-beating Q3 earnings report.

CEO Ted Decker warned that consumers are holding back on expensive remodeling projects as they wait for loan rates to improve. “We’ll have to work our way through this current macro uncertainty and the interest rates pressuring home improvement demand,” he said. “But this is a market, after all, and markets return to equilibrium, and remodeling will as well. We just don’t think we’re quite there yet.”

On Wall Street, Evercore ISI analyst Greg Melich highlighted the improving number of transactions and cost leverage as positives from the Q3 report. Melich and his team think macroeconomic factors will dictate if 2025 Street estimates move higher.

JPMorgan analyst Christopher Horvers pointed to strong Q3 results with upside driven by sales. He also sees some conservatism on the annual EPS forecast from the home improvement retailer.

DA Davidson analyst Michael Baker noted that hurricane related sales likely helped during Q3, but even without that, trends are “at worst” bouncing along the bottom despite the recent spike back up in interest rates.

Morgan Stanley analyst Simeon Gutman said Home Depot (HD) is moving in the right direction, although the firm is still waiting for a turn in existing home sales to drive a more meaningful pickup in demand.

On Seeking Alpha, Investing Group Leader Deep Value Ideas has fresh analysis on how investors should view Home Depot (HD) post-earnings.

Shares of Home Depot (HD) were down 0.7% at 1:40 p.m. Lowe’s (LOW) was off 1.4%.