EPS Preview: Big Beautiful EPS Season

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EPS Preview: Big Beautiful EPS Season

Consumer | Retail Broadlines & Hardlines

May 18, 2026

Greg Melich, CFA EPS Preview: Big Beautiful EPS Season

212-446-9484 Home Depot kicks off “Home” retail EPS Tuesday, with Target and

Greg.Melich@evercoreisi.com Walmart closely following Wednesday and Thursday. All eyes will

Oliver Wintermantel be on how a resilient U.S. consumer holds up into summer as tax

212-497-0864 refunds fade and spiking energy costs start to bite. Our RS and HI Lead

Oliver.Wintermantel@evercoreisi.com

Indicators remain lackluster. Tax cuts matter: despite higher gas costs,

Michael Montani, CFA

retail sales managed powerful 5%+ growth in March/April, setting up for 212-446-5655

Michael.Montani@evercoreisi.com a generally robust 1Q earnings season. The focus will be on the rate

Daragh Regan of deceleration seen into May and how retailers update their guidance

212-446-5603 based on those trends. It’s worth remembering Trump 2.1 Tax Cuts

Daragh.Regan@evercoreisi.com provide real ongoing support through 2026, helping mute pressures

from rising energy costs on the demand side. Turning to profit growth,

relatively clean inventory, abating tariff pressures, and productivity

gains (even some AI) should aid reacceleration of Retail EPS growth

toward a “normal” pre-COVID 10%+. For 2026, Energy Matters. We

cut to a more modest to 6% in April. Many retailers will have their first

chance to update since diesel broke $5/gallon (figure 18).

Which retailers can capture the turn? Consumers remain value

conscious after years of cumulative inflation. The tax cuts were

unexpected by a majority of consumers, helping discretionary spend in

March/April with the focus on shifts as the tax cut tailwinds revert to a

more modest ~$10bn/month yoy. The importance of speed,