The fourth-quarter earnings season is wrapping up, with Home Depot set to report tomorrow. Analysts expect a challenging but resilient performance, with projected earnings per share of $2.52 and revenue of $38.25 billion, down 19.5% and 3.7% year-over-year, respectively. Home Depot’s outlook includes 3% sales growth and slightly positive comparable sales for the fiscal year.

The company forecasts flat to +2% comparable sales growth for the upcoming year, with a recovery scenario predicting +4% to +5% if housing activity rebounds. The interest rate outlook is crucial, expected to decline gradually throughout the year, stimulating housing turnover and remodel activity and easing affordability constraints.

The Zacks Earnings ESP indicator suggests a potential upside surprise for Home Depot, with a positive surprise rate of 70% for stocks with a Zacks Rank #3 or better and a positive Earnings ESP. Investors will closely watch professional customer trends and recent acquisitions.

Lowe’s is set to report its fourth-quarter earnings on Wednesday, with estimated EPS of $1.95 and revenue of $20.36 billion, reflecting a 1.04% and 9.76% increase year-over-year, respectively. The company remains a Zacks Rank #4 (Sell), with a focus on Pro customers and online sales growth offsetting DIY weakness.

Home improvement and residential remodel trends for 2026 suggest a modest recovery driven by pent-up demand and equity-rich homeowners. Digital conversion and loyalty programs are expected to support growth, despite ongoing macro headwinds. Interested in doubling your stocks? Check out Zacks’ latest report featuring 5 stocks with potential for 100% or more gains.

Read more at Nasdaq: Earnings Whispers: Home Depot (HD) Poised for Positive Surprise