Reflecting On Home Furnishing and Improvement Retail Stocks’ Q2 Earnings: Home Depot (NYSE:HD)
As Q2 earnings season comes to a close, it’s time to take stock of this quarter's best and worst performers amongst the home furnishing and improvement retail stocks, 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 weaker Q2; on average, revenues missed analyst consensus estimates by 1.39%, while next quarter's revenue guidance was 3.22% under consensus. High-growth stocks have been under pressure as inflation makes their long-dated profits less valuable, and home furnishing and improvement retail stocks have not been spared, with share prices down 14.4% since the previous earnings results, on average.
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 $42.9 billion, down 2% year on year, beating analyst expectations by 1.63%. It was a slower quarter for the company, with a miss of analysts' gross margin estimates.
"We were pleased with our performance in the second quarter," said Ted Decker, chair, president and CEO.
The stock is down 10.3% since the results and currently trades at $296.02.
Read our full report on Home Depot here, it's free.
Best Q2: RH (NYSE:RH)
Formerly known as Restoration Hardware, RH (NYSE:RH) is a specialty retailer that exclusively sells its own brand of of high-end furniture and home decor.
RH reported revenues of $800.5 million, down 19.3% year on year, beating analyst expectations by 1.84%. It was a mixed quarter for the company, with an impressive beat of analysts' earnings estimates but a miss of analysts' gross margin estimates.
RH pulled off the strongest analyst estimates beat but had the slowest revenue growth among its peers. The stock is down 32.2% since the results and currently trades at $250.3.
Is now the time to buy RH? Access our full analysis of the earnings results here, it's free.
Slowest Q2: 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 $1.86 billion, down 12.9% year on year, missing analyst expectations by 4.81%. It was a weak quarter for the company, with a miss of analysts' revenue estimates and a miss of analysts' gross margin estimates.
Williams-Sonoma had the weakest performance against analyst estimates in the group. The stock is up 29% since the results and currently trades at $161.55.
Read our full analysis of Williams-Sonoma's results here.
Arhaus (NASDAQ:ARHS)
With an aesthetic that features natural materials such as reclaimed wood, Arhaus (NASDAQ:ARHS) is a high-end furniture retailer that sells everything from sofas to rugs to bookcases.
Arhaus reported revenues of $312.9 million, up 2.17% year on year, missing analyst expectations by 4.49%. It was a weak quarter for the company, with a miss of analysts' revenue estimates and a miss of analysts' gross margin estimates.
Arhaus delivered the highest full year guidance raise among the peers. The stock is down 15.6% since the results and currently trades at $9.8.
Read our full, actionable report on Arhaus 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 $1.14 billion, up 4.23% year on year, missing analyst expectations by 1.15%. It was a weak quarter for the company, with a miss of analysts' gross margin estimates and full-year revenue guidance missing analysts' expectations.
Floor And Decor scored the fastest revenue growth but had the weakest full year guidance update among the peers. The stock is down 17.9% since the results and currently trades at $91.16.
Read our full, actionable report on Floor And Decor here, it's free.
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The author has no position in any of the stocks mentioned
