Home Depot (HD) reported earnings per share of $4.92 for the second quarter of fiscal 2026 (ended Aug. 2, 2026), against an analyst estimate of $4.73. Revenue was $47.86B against an estimate of $47.24B. Both beat, and margins recovered from the winter low. The next report is due Nov. 17, 2026, so this is the most recent hard data on the business.
Key facts
- Earnings reported Aug. 18, 2026: EPS of $4.92 beat the $4.73 estimate by $0.19. Revenue of $47.86B beat the $47.24B estimate by $617.9M.
- Quarter ended Aug. 2, 2026: revenue was $47.86B, up 5.7% from the year-ago quarter. Net income was $4.77B, up 4.7%. Diluted EPS was $4.79.
- Margins in the same quarter: gross margin was 33.7% and operating margin was 14.3%. A year earlier, operating margin was 14.5%.
- Latest quote (as of Oct. 21, 2026): $314.14, down 0.31%. The 52-week range is $277.15 to $397.63.
- Next earnings date: Nov. 17, 2026. Analysts expect EPS of $3.84 and revenue of $42.77B.
What happened
Home Depot posted a quarter that beat on both sales and profit per share. Revenue rose 5.7% from the same quarter a year earlier. Net income rose 4.7%, so profit grew a little more slowly than sales.
The EPS figures differ because the $4.92 used for the beat comparison is the figure reported against analyst estimates. The $4.79 is the diluted EPS in the filed income statement. Both are for the same quarter.
In the quarter ended Aug. 2, 2026, Building Materials brought in $14.43B and Hardlines $14.45B. Décor brought in $13.93B, and the Other segment $5.05B. A like-for-like year-ago breakdown by segment is not available in our data, so we do not draw growth conclusions from the segment figures. Geographically, non-US revenue was $3.95B. The rest, $43.91B, came from the United States.
The company's release and a call transcript were not part of the data for this article. We therefore can't quote management's explanation of what drove the quarter.
Five quarters of margins and cash
Home Depot's business is seasonal, and the trend shows it. The summer quarter is the peak and the winter quarter is the low.
| Quarter (ended) | Revenue | Gross margin | Operating margin | Net income | |---|---|---|---|---| | Q2 FY2025 (Aug. 3, 2025) | $45.28B | 33.4% | 14.5% | $4.55B | | Q3 FY2025 (Nov. 2, 2025) | $41.35B | 33.4% | 12.9% | $3.60B | | Q4 FY2025 (Feb. 1, 2026) | $38.20B | 32.6% | 10.1% | $2.57B | | Q1 FY2026 (May 3, 2026) | $41.77B | 33.0% | 11.9% | $3.29B | | Q2 FY2026 (Aug. 2, 2026) | $47.86B | 33.7% | 14.3% | $4.77B |
Operating margin is the share of each sales dollar left after running the stores and paying for the goods. It fell to 10.1% in the quarter ended Feb. 1, 2026, then climbed back to 14.3%. Gross margin, which counts only the cost of the products sold, reached 33.7%, the highest of the five quarters. Operating margin is still slightly below the year-ago 14.5%. The business is back near last summer's profitability, not clearly past it.
Free cash flow is cash from operations minus capital spending. It was $4.51B in the latest quarter, versus $5.19B in the quarter ended May 3, 2026 and $3.73B a year earlier. Dividends were $2.32B in the latest quarter. Our data shows no share buybacks in any of the five quarters.
Why it matters for investors
Valuation versus peers. On a trailing-12-month basis, Home Depot trades at a P/E (price divided by yearly earnings per share) of 21.94. Its net margin is 8.4%. Lowe's has a trailing P/E of 16.60 and a net margin of 7.3%. Smaller specialty peers sit in a similar range. Floor & Decor has a P/E of 20.98 and a net margin of 4.9%. Kingfisher has a P/E of 19.79 and a net margin of 2.3%. SiteOne has a P/E of 26.63 and a net margin of 3.4%. Home Depot earns a higher margin than every peer listed, and the market pays a higher multiple than for Lowe's, Kingfisher and Floor & Decor. Other trailing multiples are 1.85 for price/sales, 14.68 for EV/EBITDA and 20.75 for price/free cash flow. The dividend yield is 3.0%.
Analysts. Of 63 analyst ratings, 1 is strong buy, 36 are buy, 22 are hold and 4 are sell, for a consensus of "Buy." The average price target is $379.93, the median is $377.50, the high is $425.00 and the low is $340.00. Even the lowest target is above the Oct. 21 price of $314.14. These are analysts' views, not ours. For the future, analysts expect EPS of 4.05 for the period ending May 2, 2028, and 5.47 for the period ending Aug. 2, 2028 (10 analysts each).
Our MoonshotScore. Stock Expert AI's MoonshotScore V2 for HD is 69.4, rated Strong. Against other companies in its sector, the pillars are:
- Quality: 86, the strongest area
- Momentum: 62
- Safety: 62
- Growth: 49
- Valuation: 32, the weakest area
Financial strength. The Piotroski score, a 0-9 health checklist, is 6. The Altman Z score, a bankruptcy-risk gauge where higher is safer, is 5.50.
What could go wrong
- Debt. Total debt was $62.57B and cash was $2.08B as of Aug. 2, 2026, leaving net debt of $60.48B against shareholders' equity of $16.62B. Debt/equity is 3.77.
- Valuation. FMP's discounted cash flow model, which estimates value from projected cash flows, puts HD at $275.39 per share as of Oct. 22, 2026. That is below the market price and the analyst targets. It is one model's estimate, and such models are very sensitive to their assumptions. Our own valuation pillar is the weakest at 32.
- Seasonality. The next quarter is a seasonally slower one, and analysts expect lower revenue and EPS than in the quarter just reported.
- Insider selling. Among the 30 most recent insider filings, those in the last 90 days show 0 open-market purchases and 4 sales. Older filings in the window may be missing. Insider sales are common and can have many causes, but there is no insider buying to offset them.
- Growth. Our growth pillar is 49, so the business is not scoring as a high-growth name.
What to watch next
- Nov. 17, 2026: the next earnings report. Analysts expect EPS of 3.84 and revenue of $42.77B.
- Operating margin: whether it holds near the recent level or slips as the seasonal peak passes.
- Free cash flow: whether it stays strong relative to the $2.32B quarterly dividend.
- Debt: whether net debt moves from $60.48B and whether buybacks resume.
- Price levels: the stock is at $314.14, inside a 52-week range of $277.15 to $397.63.
Frequently asked questions
Q: Did Home Depot beat earnings expectations?
Yes. For the quarter ended Aug. 2, 2026, reported EPS was $4.92 against an estimate of $4.73. Revenue was $47.86B against an estimate of $47.24B. The company reported on Aug. 18, 2026.
Q: Is Home Depot stock expensive compared with Lowe's?
On trailing-12-month numbers, HD's P/E is 21.94 and Lowe's is 16.60. HD's net margin is 8.4% and Lowe's is 7.3%. The market is paying more for each dollar of HD earnings. Whether that premium is justified depends on how long HD keeps its margin edge. Our valuation pillar is the weakest at 32.
Q: What do analysts think Home Depot is worth?
Analysts' consensus price target averages $379.93, with a range of $340.00 to $425.00. The stock traded at $314.14 on its latest quote, as of Oct. 21, 2026. Analysts' ratings are mostly "buy," with 22 "hold" and 4 "sell." These are analysts' opinions, not a recommendation from Stock Expert AI, and the targets can be wrong.
This is educational content, not investment advice. Past performance does not guarantee future results.