Home Improvement's Hangover Could Last

Impact · against what's priced in

Disappointing U.S. retail sales provide a negative catalyst for retail names ahead of earnings, as it suggests a slower consumer environment. For Home Depot, this specifically challenges the assumption that the cycle trough has been reached and that comps are inflecting toward low-single-digit growth.

HD−0.20

Challenges what's priced in

The price assumes

Cycle trough already reached: comps inflecting off flat toward LSD

The reported disappointment in U.S. retail sales suggests consumer spending is softening, which contradicts the belief that Home Depot's comps have already hit their floor and are now inflecting upward.

What HD's price assumes · Feb 24

• TGT▲60%
• earnings
• HD
• LOW
• ROST
• TJX
• china economy
• consumer spending
• retail sales
• retailers