Q3 Rundown: Floor And Decor (NYSE:FND) Vs Other Home Furnishing and Improvement Retail Stocks
The end of an earnings season can be a great time to discover new stocks and assess how companies are handling the current business environment. Let’s take a look at how Floor And Decor (NYSE:FND) and the rest of the home furnishing and improvement retail stocks fared in Q3.
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 slower Q3. As a group, revenues missed analysts’ consensus estimates by 0.6% while next quarter’s revenue guidance was 8.9% below.
Luckily, home furnishing and improvement retail stocks have performed well with share prices up 19.6% on average since the latest earnings results.
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 $1.12 billion, flat year on year. This print fell short of analysts’ expectations by 1.5%, but it was still a satisfactory quarter for the company with an impressive beat of analysts’ EBITDA estimates but full-year revenue guidance slightly missing analysts’ expectations.
Tom Taylor, Chief Executive Officer, stated, “We are incredibly proud of how our store and store support teams executed our plans and managed costs during a period when demand for large project discretionary home improvement and hard surface flooring spending remained challenging. In the face of these challenges, the hard work and dedication of our associates enabled us to deliver fiscal 2024 third quarter diluted earnings per share of $0.48, which exceeded our expectations. We continue implementing and executing strategies designed to grow our market share while working prudently to manage our profitability and maintain a strong balance sheet in this challenging period. I particularly want to thank our associates affected by the recent hurricanes for their hard work and dedication to their communities. Thanks to their efforts, we quickly reopened our stores to begin serving customers affected by the hurricanes as they began their recovery and rebuilding efforts.”
Floor And Decor Total Revenue
Interestingly, the stock is up 1.3% since reporting and currently trades at $102.21.
Is now the time to buy Floor And Decor? Access our full analysis of the earnings results here, it’s free.
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 $1.80 billion, down 2.9% year on year, outperforming analysts’ expectations by 1.1%. The business had a strong quarter with a decent beat of analysts’ gross margin and EPS estimates.
Williams-Sonoma Total Revenue
The market seems happy with the results as the stock is up 56.3% since reporting. It currently trades at $214.45.
Is now the time to buy Williams-Sonoma? Access our full analysis of the earnings results here, it’s free.
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 $319.1 million, down 2.2% year on year, falling short of analysts’ expectations by 3.1%. It was a disappointing quarter as it posted full-year EBITDA guidance missing analysts’ expectations.
Arhaus delivered the weakest full-year guidance update in the group. Interestingly, the stock is up 30.6% since the results and currently trades at $11.91.
Read our full analysis of Arhaus’s results here.
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 $40.22 billion, up 6.6% year on year. This number beat analysts’ expectations by 2.4%. Aside from that, it was a satisfactory quarter as it also recorded a decent beat of analysts’ EPS estimates but a slight miss of analysts’ gross margin estimates.
Home Depot delivered the biggest analyst estimates beat among its peers. The stock is up 3.1% since reporting and currently trades at $421.28.
Read our full, actionable report on Home Depot here, it’s free.
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 $811.7 million, up 8.1% year on year. This result met analysts’ expectations. Aside from that, it was a softer quarter as it produced a significant miss of analysts’ EBITDA and gross margin estimates.
RH scored the fastest revenue growth among its peers. The stock is up 11% since reporting and currently trades at $423.14.
Read our full, actionable report on RH here, it’s free.
Thanks to the Fed’s series of rate hikes in 2022 and 2023, inflation has cooled significantly from its post-pandemic highs, drawing closer to the 2% goal. This disinflation has occurred without severely impacting economic growth, suggesting the success of a soft landing. The stock market thrived in 2024, spurred by recent rate cuts (0.5% in September and 0.25% each in November and December), and a notable surge followed Donald Trump’s presidential election win in November, propelling indices to historic highs. Nonetheless, the outlook for 2025 remains clouded by the pace and magnitude of future rate cuts as well as potential changes in trade policy and corporate taxes once the Trump administration takes over. The path forward is marked by uncertainty.
Want to invest in winners with rock-solid fundamentals? Check out our Top 6 Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.
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