Home Depot shares lag peak as same-store sales growth stalls
With same-store sales rising just 0.6 per cent and the stock trading 28 per cent below its record high, analysts at The Motley Fool have excluded the home improvement leader from their top ten investment picks.
Home Depot shares are currently trading 28 per cent below their record high as of June 4, reflecting ongoing weakness in consumer spending within the home improvement sector. The retailer’s fiscal 2026 first quarter, which ended on May 3, saw annualised revenue reach $167 billion. However, same-store sales grew by only 0.6 per cent, a figure driven by higher average ticket sizes that partially offset lower customer traffic.
This modest expansion follows a 0.3 per cent gain in fiscal 2025 and a 1.8 per cent decline in fiscal 2024. The company operates 2,361 company stores and maintains a dominant position in the market, yet it continues to face cyclicality. Higher mortgage rates and broader inflationary pressures have dampened consumer confidence, leading to reduced spending on big-ticket renovations and upgrades.
The Motley Fool’s Stock Advisor analyst team has explicitly excluded Home Depot from their current list of the 10 best stocks to buy. The publication, which disclosed positions in and recommends the retailer, noted that while the company offers a 3 per cent dividend yield, the current economic environment presents significant challenges for near-term growth.
The analysts highlighted that same-store sales provide a clearer view of financial health by stripping out the impact of new store openings. Despite the strong revenue figure, the persistent lack of comparable sales growth suggests that the macroeconomic headwinds affecting the housing market are yet to subside.
Historical context from The Motley Fool illustrates the potential returns of their top picks, citing examples such as Netflix and Nvidia, which delivered substantial gains for early investors. The service reported a total average return of 968 per cent as of June 6, 2026, compared to 211 per cent for the S&P 500, underscoring the selectivity of their current recommendations.
