Looking back on home furnishing and improvement retail stocks’ Q1 earnings, we examine this quarter’s best and worst performers, including Home Depot (NYSE: HD) and its peers.
Home furnishing and improvement retailers understand that ‘home is where the heart is’ but that a home is only right when it’s in livable condition and furnished just right. These stores therefore focus on providing what is needed for both the upkeep of a house as well as what is desired for the aesthetics of a home. Decades ago, it was thought that furniture and home improvement would resist e-commerce because of the logistical challenges of shipping a sofa or lawn mower, but now you can buy both online; so just like other retailers, these stores need to adapt to new realities and consumer behaviors.
The 7 home furnishing and improvement retail stocks we track reported a slower Q1. As a group, revenues along with next quarter’s revenue guidance were in line with analysts’ consensus estimates.
While some home furnishing and improvement retail stocks have fared somewhat better than others, they have collectively declined. On average, share prices are down 1.6% since the latest earnings results.
Home Depot (NYSE: HD)
Founded and headquartered in Atlanta, Georgia, Home Depot (NYSE: HD) is a home improvement retailer that sells everything from tools to building materials to appliances.
Home Depot reported revenues of $39.86 billion, up 9.4% year on year. This print exceeded analysts’ expectations by 1.6%. Despite the top-line beat, it was still a slower quarter for the company with a miss of analysts’ EBITDA estimates and gross margin in line with analysts’ estimates.
"Our first quarter results were in line with our expectations as we saw continued customer engagement across smaller projects and in our spring events," said Ted Decker, chair, president and CEO.
Unsurprisingly, the stock is down 5.9% since reporting and currently trades at $356.99.
Read our full report on Home Depot here, it’s free.
Best Q1: Williams-Sonoma (NYSE: WSM)
Started in 1956 as a store specializing in French cookware, Williams-Sonoma (NYSE: WSM) is a specialty retailer of higher-end kitchenware, home goods, and furniture.
Williams-Sonoma reported revenues of $1.73 billion, up 4.2% year on year, outperforming analysts’ expectations by 4%. The business had a strong quarter with a decent beat of analysts’ EBITDA estimates.
Williams-Sonoma pulled off the biggest analyst estimates beat among its peers. Although it had a fine quarter compared its peers, the market seems unhappy with the results as the stock is down 2.1% since reporting. It currently trades at $164.10.
Is now the time to buy Williams-Sonoma? Access our full analysis of the earnings results here, it’s free.
Slowest Q1: Sleep Number (NASDAQ: SNBR)
Known for mattresses that can be adjusted with regards to firmness, Sleep Number (NASDAQ: SNBR) manufactures and sells its own brand of bedding products such as mattresses, bed frames, and pillows.
Sleep Number reported revenues of $393.3 million, down 16.4% year on year, falling short of analysts’ expectations by 1.2%. It was a softer quarter as it posted a significant miss of analysts’ EBITDA and EPS estimates.
Sleep Number delivered the weakest performance against analyst estimates and slowest revenue growth in the group. As expected, the stock is down 10.8% since the results and currently trades at $6.95.
Read our full analysis of Sleep Number’s results here.
Lowe's (NYSE: LOW)
Founded in North Carolina as Lowe's North Wilkesboro Hardware, the company is a home improvement retailer that sells everything from paint to tools to building materials.
Lowe's reported revenues of $20.93 billion, down 2% year on year. This result was in line with analysts’ expectations. Taking a step back, it was a mixed quarter as it also logged a narrow beat of analysts’ gross margin estimates but full-year revenue guidance meeting analysts’ expectations.
Lowe's pulled off the highest full-year guidance raise among its peers. The stock is down 6.2% since reporting and currently trades at $216.59.
Read our full, actionable report on Lowe's here, it’s free.
Floor And Decor (NYSE: FND)
Operating large, warehouse-style stores, Floor & Decor (NYSE: FND) is a specialty retailer that specializes in hard flooring surfaces for the home such as tiles, hardwood, stone, and laminates.
Floor And Decor reported revenues of $1.16 billion, up 5.8% year on year. This print met analysts’ expectations. However, it was a slower quarter as it recorded full-year revenue guidance missing analysts’ expectations and full-year EBITDA guidance missing analysts’ expectations.
The stock is up 8.6% since reporting and currently trades at $78.53.
Read our full, actionable report on Floor And Decor here, it’s free.
Market Update
The Fed’s interest rate hikes throughout 2022 and 2023 have successfully cooled post-pandemic inflation, bringing it closer to the 2% target. Inflationary pressures have eased without tipping the economy into a recession, suggesting a soft landing. This stability, paired with recent rate cuts (0.5% in September 2024 and 0.25% in November 2024), fueled a strong year for the stock market in 2024. The markets surged further after Donald Trump’s presidential victory in November, with major indices reaching record highs in the days following the election. Still, questions remain about the direction of economic policy, as potential tariffs and corporate tax changes add uncertainty for 2025.
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