Home Depot’s 26% slide signals housing weakness ahead of earnings

Home Depot shares closed at $312.42 on May 4, just 15 cents above their 52-week low, and the slide is starting to look like more than a Wall Street problem. The stock was 26.9% below its 52-week high of $426.75, while Lawrence McDonald, the NY Times bestselling author and CNBC contributor, pointed to a roughly 26% drawdown as stock indexes hit records, a rare setup he said has shown up in past downturns.

For store teams, the signal matters because Home Depot makes its money when customers decide to tackle kitchens, baths, roofs, appliances and other big projects. In its Feb. 24 earnings report, the company said fourth-quarter sales were $38.2 billion, down 3.8% from a year earlier, even as comparable sales rose 0.4% overall and 0.3% in the U.S. Home Depot also lifted its quarterly dividend by 1.3% and laid out fiscal 2026 guidance, but management said the results reflected ongoing consumer uncertainty and pressure in housing.

That backdrop lines up with what CNBC and Axios have been describing: slow housing turnover, high interest rates and a housing market that has stalled major home projects. Axios said housing transactions fell 6.3% and large remodels remain under pressure. For associates on the floor, that is the difference between a customer picking up patch materials, paint and a few tools, and a pro or homeowner committing to a full remodel order that can run through millwork, flooring, appliances and delivery.

Home Depot remains a giant, with fiscal 2025 sales of $164.7 billion and operations across the United States, Canada and Mexico. It is headquartered in Cobb County, Georgia, with an Atlanta mailing address, and it still stands as the world’s largest home improvement retailer by net sales. But size does not insulate the chain from a softer housing cycle. If turnover stays sluggish, stores are likely to feel it first in traffic, in the sales mix and in how much of the basket comes from smaller maintenance buys instead of major discretionary projects.

The next checkpoint comes May 19, when Home Depot will report first-quarter 2026 results before the market opens. That release will tell managers and associates whether the weakness behind the stock chart is staying confined to investor sentiment or is showing up more clearly in project demand, staffing needs and the pace of the pro business.