THE HOME DEPOT (=) : Trying to turn the key, but the house remains (rate)locked

Research evidence excerpt

THE HOME DEPOT (=) : Trying to turn the key, but the house remains (rate)locked

EQUITIES

GENERAL RETAIL

THE HOME DEPOT NEUTRALPRICE* USD299.8  TARGET PRICE USD325 (UPSIDE 8%) TARGET -7%PRICE EPS 01/27e-2% EPS 01/28e-5%

Trying to turn the key, but the house remains (rate)locked

See our first look for expanded thoughts on Q1 results and the reiterated FY26 guide. HD shares are19 MAY 2026

Securities Research Report +0.3% today vs. S&P 500 -0.8%.

Production time: 17:39* (London time)

Research Analysts & Publishing Entities Contending with a rate-locked macro environment

Chris Bottiglieri, CFA The housing and refinance market remains rate locked, and in its core business there is very little

BNP Paribas Securities Corp1 that HD can do on its own to change that outlook. While Home Depot appears to be making progress

(+1) 646 342 2463

christopher.bottiglieri@us.bnpparibas.com in complex pro, the build-out remains very dilutive to the building blocks of valuation including ROIC,

leverage, cyclicality, and business quality – given competitive pressure for a finite pool of acquisition

Ian Davis

candidates, the build-out pressures are unlikely to abate any time soon.BNP Paribas Securities Corp1

(+1) 212 710 9784

ian.m.davis@us.bnpparibas.com 4 key takeaways following Q1 results

1) Guide remains 2H weighted, and we see risk given the combination of a reliance on storm activityHunter Lawson

BNP Paribas Securities Corp1 normalizing, monthly comps slowing, no clear Q2 inflection despite decent EHS in April, and

+1 934-233-7189 dissipating tax refund benefits. 2) Tax refund commentary felt opaque, though we expect there was

hunter.lawson@us.bnpparibas.com

a net-tailwind (which we think could linger into Q2). 3) GMs expected to be flattish y/y in 2H once