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Miami Herald
33 minutes ago
- Business
- Miami Herald
Home Depot store closing indefinitely after scary incident
Retailers have been fighting an uphill battle over the past several years. Five years ago, Covid hit nearly every retailer hard. Related: Huge retail chain suddenly closing 100s of stores, no bankruptcy The beginning of 2020 brought a series of challenges for which most retailers weren't prepared. Even the oldest or most robust brands weren't anticipating a pandemic that would bring brick-and-mortar commerce to a near-screeching halt. For at least a few weeks, almost every retailer had to scramble to figure out how to stay afloat. Some were better equipped than others. Most every brick-and-mortar retailer was forced to shut down for at least some period of time, while customers stayed away and foot traffic went to zero. This put a lot of strain on e-commerce companies, which suddenly saw a spike in demand for inventory and had to coordinate logistics and shipments across the U.S. as efficiently and quickly as possible. And once the world reopened, many retailers experienced something of a jolt when they had to quickly adapt to a completely changed world. Interest rates rose sharply, making debt, growth, and recovery more expensive. And customer behavior had been changed forever. But some retailers were spared more than others. During Covid, many of us increased our time spent at home or around the house. That meant that many of us looked around and saw the projects we'd been putting off because of a busy schedule. Or maybe we just started to notice things that needed to be done. More closings: Popular local Dairy Queen rival suddenly closing, no bankruptcyAnother big Mexican chain closing down restaurant, no bankruptcyUPS suddenly closing more stores amid chaotic new change, layoffsPopular fast-food burger chain closes all restaurants in key area So when things slowly began opening back up, many Americans were far more likely to go into an open and sprawling big-box retailer like Home Depot than they were to go inside a crowded bar or gym. That meant good business for home improvement retailers. Between 2020-2022, Home Depot brought in record revenue. It added $40 billion in sales (a growth rate that had taken it nine years to achieve previously). And the company continues to fly high; it made its largest-ever acquisition in 2024, buying SRS Distribution for over $18 billion. No matter how high-flying a retailer might be, however, there is always a chance that an unforeseen event can close things down again. Such is the case with a Home Depot store located in Topsham, Maine. Related: Huge troubled retailer closing dozens of stores, laying off 100s The store, which is located near other big-box stores approximately 15 minutes outside of Freeport, Maine, was closed on Monday after a fire broke out in the early morning. Firefighters responded to a call around 4:25 am. The blaze was confined mostly around the cash register section. Officials believe it was caused by a battery that overheated while a radio was in its charging station. Smoke and water left much of the store damaged, and it will be closed until further notice. The Arena Media Brands, LLC THESTREET is a registered trademark of TheStreet, Inc.
Yahoo
a day ago
- Business
- Yahoo
Home Depot Second Company Looking to Buy GMS, Report Says
Home Depot could be in a buyout battle. The Wall Street Journal on Thursday reported that Home Depot (HD), the home-improvement giant, has made an offer to acquire GMS (GMS), a building-products distribution company. The Journal, citing people familiar with the matter, did not specify a price; Visible Alpha lists the market capitalization of GMS at around $3.1 billion. QXO (QXO), another building products distributor, on Wednesday said it had offered to buy GMS for $95.20 per share in case, an 18% premium to Wednesday's close. Shares of GMS soared 23% in premarket trading Friday. They rose about 10% on Wednesday; stock markets were closed yesterday. Home Depot's shares were recently slipped 0.5%, while QXO's were up nearly 3%. The offer "delivers immediate and certain value to GMS shareholders at a meaningful premium,' QXO CEO and Chairman Brad Jacobs said in a statement. "We believe this is a compelling opportunity for GMS investors to realize the full value of their shares in a single, decisive transaction.' QXO declined to comment on the Journal's report. GMS on Thursday confirmed receipt of QXO's offer and said its board would review it. The company did not respond to Investopedia's request for comment on the Journal's report in time for publication. Home Depot last year acquired SRS Distribution, which sells and distributes construction materials, for more than $18 billion. The company declined to comment. Read the original article on Investopedia Sign in to access your portfolio
Globe and Mail
12-06-2025
- Business
- Globe and Mail
Home Depot's Margins Hold Steady: Is Top-Line Growth Stalling?
Margins are a vital indicator of operational efficiency, and for The Home Depot Inc. HD, margins are its core strength. With its scale-driven cost leverage, tight inventory controls and robust supply chain, the retailer has consistently outperformed its peers on profitability. In first-quarter fiscal 2025, Home Depot maintained a gross margin of 33.8% and an adjusted operating margin of 13.2%, despite pressures from higher SG&A and integration of SRS Distribution. The ability to manage shrink, supply-chain productivity and pricing helped partially offset margin pressures, even as the company invested heavily in Pro ecosystem capabilities and digital tools like Magic Apron. This underscores its disciplined execution. However, top-line momentum tells a more tempered story. While total sales rose 9.4% to $39.9 billion—buoyed largely by acquisitions and calendar shifts—comparable sales declined 0.3%, with U.S. comps up just 0.2%. Big-ticket sales, often a barometer of remodeling demand, grew just 0.3%, as elevated interest rates weighed on demand for larger financed projects like kitchen and bath remodels. Instead, customers gravitated toward smaller DIY tasks and seasonal purchases, highlighting the ongoing macro sensitivity to elevated interest rates and sluggish housing turnover. Home Depot's Pro ecosystem expansion, digital tools like Magic Apron and exclusive brand deals are well-positioned to unlock future growth. However, without a rebound in large-scale renovation demand, fueled by easier credit or greater macro confidence, the company may find it challenging to convert margin resilience into sustained revenue acceleration. Home Depot's Competition From Margins Standpoint From a margin standpoint, Home Depot's main competitors are Lowe's Companies Inc. LOW and Walmart Inc. WMT. Home Depot typically maintains stronger net margins than Lowe's, driven by its scale, financial strength and operational efficiency. In first-quarter fiscal 2025, Lowe's posted a 33.4% gross margin and an 11.9% operating margin, with comparable sales down 1.7% due to weak big-ticket DIY demand and unfavorable weather. While Lowe's saw gains in Pro and online channels and continues to expand margin and ROIC, it still trails Home Depot in Pro penetration and supply-chain execution. The key difference lies in customer mix, Home Depot's more mature Pro ecosystem offers stability and higher margins, whereas Lowe's heavier DIY exposure makes it more sensitive to consumer spending shifts. Walmart, though significantly larger in revenues and similarly leveraged, operates with a very different margin profile than Home Depot. In first-quarter fiscal 2025, Walmart posted a gross margin of 24.2% and an operating margin of 5.1%, with a net profit margin of 2.75%, well below Home Depot's nearly 9%. Walmart's scale and grocery-heavy mix offer sales stability but limit margin upside. In contrast, Home Depot's focus on higher-margin categories like tools, appliances and Pro services supports stronger profitability. Walmart's pricing power is more exposed to rising costs and tariffs, prompting selective price hikes, while Home Depot's specialized model and margin flexibility help it maintain stable pricing. The Zacks Rundown for Home Depot HD shares have lost 7.3% year to date compared with the industry 's decline of 9%. From a valuation standpoint, Home Depot trades at a forward price-to-earnings ratio of 23.22X, significantly higher than the industry's 20.83X. It carries a VGM Score of A. The Zacks Consensus Estimate for HD's fiscal 2025 earnings implies a year-over-year decline of 1.3%, whereas its fiscal 2026 earnings estimates indicate year-over-year growth of 9.2%. The estimate for fiscal 2025 has been northbound in the past 30 days, while that for fiscal 2026 EPS has moved south in the same period. Home Depot currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. 5 Stocks Set to Double Each was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2024. While not all picks can be winners, previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%. Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor. Today, See These 5 Potential Home Runs >> Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Walmart Inc. (WMT): Free Stock Analysis Report Lowe's Companies, Inc. (LOW): Free Stock Analysis Report The Home Depot, Inc. (HD): Free Stock Analysis Report
Yahoo
23-05-2025
- Business
- Yahoo
Worried About Tariffs? Home Depot Says It Won't Raise Prices.
Home Depot reported a mixed first quarter, with EPS that came in below expectations. Management said that it would not raise prices because of tariffs. Home Depot's profit margins are higher than many competitors. 10 stocks we like better than Home Depot › Will they or won't they? That's the question on investors' and shoppers' minds alike as retailers start outlining their strategies to deal with tariffs. Walmart said last week that it would need to raise some prices, but it provided a broad outline of how it would seek to minimize the price hikes through redistributing its import bases, reworking packaging, and other actions. Home Depot (NYSE: HD), on the other hand, told investors during its first-quarter earnings report that it wouldn't raise prices. That was welcome news, considering all the other problems the company is having today. Let's take a deeper look at what's going on. Home Depot is a perennial winner and market beater, but it's experiencing strong external pressure from a variety of interconnected sources. The real estate industry is struggling through continued high interest and mortgage rates, leading to lower sales in the home improvement sector, and inflation is making it harder for customers to spend on anything extra. Home improvement is often a gray zone between essentials and discretionary spending. As the leader in the industry, Home Depot benefits from spending on what consumers can't avoid, but it feels the pinch in other categories. "People are painting again and working in their yards and doing smaller projects, but just have not engaged in the larger projects," CEO Ted Decker said during the first-quarter earnings call. The 2025 fiscal first quarter (ended May 4) was mixed, but in line with expectations. Sales increased 9.4% year over year, but comparable sales (comps) were down 0.3%. That means the growth is coming from new stores, of which there were three in the first quarter, and acquisitions, like SRS Distribution, which Home Depot purchased last year. Adjusted earnings per share (EPS) were $3.56, down from $3.67 last year and $0.04 below analyst expectations. Decker said that 50% of the company's merchandise is sourced in the U.S., and over the past few years, it's diversified its supply base so it's not reliant on any one country. He said that within the next 12 months, it will reach a level that no country outside the U.S. will be responsible for more than 10% of its purchases. Decker explained that the company has many levers to pull to offer a strong value proposition for customers even now, and that it's weathered many economic events in the past. He noted that for most homeowners, their house is their most expensive asset, and aging homes need work. Indeed, 55% of homes are at least 40 years old, and Home Depot is well-positioned to benefit from consumer spending. It's doing whatever it can to be the company to beat: upgrading its digital platforms, renovating its stores, investing in technology, and focusing on the consumer experience. To that end, Home Depot doesn't see the likelihood that it will need to increase many prices. It has an elastic model that can call up different supply lines, and it anticipates being able to cut out whatever products would require higher pricing. The company sees this as an exciting opportunity to capture market share from other retailers that don't have its scale and leverage. Although there's pressure, Home Depot still has high margins compared with other retailers. Walmart, for example, said it can't absorb tariffs because its profit margins are already low; about 2.4% today. Home Depot, on the other hand, enjoys a high profit margin compared to large retailers like Walmart, Costco Wholesale, and Target. Groceries have low margins, so this makes sense, but its profit margin is also higher than more similar companies like Lowe's and Floor & Decor. If Home Depot doesn't have to raise prices, it can grow its market share while keeping its margins healthy. Investors shouldn't get scared off because of short-term pressure. Home Depot's management is always finding ways to generate growth opportunities and become more efficient, and its approach to tariffs should boost investor confidence. The company purchased SRS last year to expand its market opportunity, which it sees as $1 trillion. And don't forget Home Depot's dividend. It yields 2.4% at the current price, and it's reliable and growing. All this means Home Depot is an excellent, all-weather choice for long-term value investors. Before you buy stock in Home Depot, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Home Depot wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $644,254!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $807,814!* Now, it's worth noting Stock Advisor's total average return is 962% — a market-crushing outperformance compared to 169% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of May 19, 2025 Jennifer Saibil has positions in Walmart. The Motley Fool has positions in and recommends Costco Wholesale, Home Depot, Target, and Walmart. The Motley Fool recommends Lowe's Companies. The Motley Fool has a disclosure policy. Worried About Tariffs? Home Depot Says It Won't Raise Prices. was originally published by The Motley Fool Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Miami Herald
20-05-2025
- Business
- Miami Herald
Don't expect storewide price increases despite tariffs, Home Depot says
Home Depot on Tuesday reported sales growth in its fiscal first quarter as consumers continued to show resiliency in the face of the trade war, but growth for existing stores in the U.S. was soft, a sign consumers continue to be guarded in making big purchases. As other retailers have pared back or put on pause their earnings expectations, the Georgia-based retail giant kept its guidance in place, saying Tuesday it still expects sales across its footprint to grow 2.8% for the fiscal year. Executives also said they did not expect widespread price increases on products as the company has worked to diversify where it buys inventory and find cost savings elsewhere. The people who tend to shop at Home Depot - largely homeowners and the contractors who serve them - have faced the uncertainties of the trade war, undulations in the stock market and high interest rates that have made borrowing for big projects and homebuying more difficult. The trade war has challenged businesses in figuring out purchasing, managing inventory and how to plan, and economists have warned the import taxes are likely to lead to inflation. Home Depot, given its place in the retail world, is a bellwether for the broader economy, and its performance offers clues to how homeowners and contractors are faring. The worst appears to be in the rearview mirror, Home Depot Chairman, President and CEO Ted Decker said in a conference call with investors and analysts. President Donald Trump has pulled back from his maximalist positions on tariffs - though U.S. tariff rates remain high - and the stock market has bounced back from a dreadful April as consumer and business sentiment plummeted. The average Home Depot customer has an income of $110,000 and 80% are homeowners, Decker said. "Our customer is in a good spot right now," he said. Home construction remains constrained, and homeowners have huge amounts of home equity that they could borrow against. Still, consumers are cautious. Faced with persistently high interest rates, homeowners have remained skittish to start big projects. But the nation's housing inventory is aging, increasing the need for maintenance and upgrades. Decker said that means consumers could come off the sidelines as the retailer heads deeper into spring and into the summer, which executives call the "Super Bowl" season for the world's largest home improvement retailer. "We remain bullish on the fundamentals of home improvement, and we are confident we are best positioned to win," Decker said. 'Because of our scale' Home Depot said its sales grew 9.4% to $39.9 billion in the quarter that ended May 4. A big part of that growth came from its purchase last year of SRS Distribution, a business that serves residential contractors. The company also opened three stores in the quarter. Net income in the quarter was $3.4 billion, down about 5% from the same period last year. When counting stores open at least a year, sales across Home Depot's network dipped 0.3% in that time, while sales at U.S. existing stores grew a modest 0.2%, the company said. Foreign currency rates played a role in the dip in international same store sales. Home Depot said the quarter met its internal expectations, though Bloomberg reported its earnings missed Wall Street expectations. Poor weather in the northern U.S. and Canada also played a role in sales softness, but sales appear to be rebounding in the early weeks of the company's second fiscal quarter, executives said on the conference call. While measures of inflation have remained low as Trump slapped tariffs on countries worldwide, retailers have warned price increases could soon begin to appear in stores and online. Walmart executives last week said that despite efforts to keep prices low and absorb costs, Trump's import taxes would force it to raise prices. That triggered a harsh response from Trump on social media, who said the company should "EAT THE TARIFFS." Home Depot executives on Tuesday's call highlighted the company's efforts over the years to diversify its supplier base. More than half the products in its stores are sourced from the U.S., and executives said that within the next 12 months, no country outside the U.S. will be the origin of more than 10% of its goods. "Because of our scale, the great partnerships we have with our suppliers and productivity that we continue to see in our business, we intend to generally maintain our current pricing levels across our portfolio," Home Depot Chief Financial Officer Richard McPhail said. Copyright (C) 2025, Tribune Content Agency, LLC. Portions copyrighted by the respective providers.
