If You'd Invested $10,000 in Home Depot (HD) 3 Years Ago, Here's How Much You'd Have Today

Home Depot remains the dominant home-improvement retailer with $166 billion in trailing-12-month sales versus Lowe’s $84.3 billion, but the stock has materially lagged the market—delivering a 16.9% total return over three years (turning $10,000 into $11,690) versus the S&P 500’s 74.6%. After pandemic-driven double-digit revenue growth in 2020–21, momentum has cooled: same-store sales fell 3.2% in fiscal 2023, 1.8% in fiscal 2024 and were essentially flat in Q3 2025, pressured by higher interest rates and weak big-ticket consumer spending. Management highlights a roughly $50 billion cumulative under‑spend in normal U.S. repair-and-remodel activity, implying meaningful pent‑up demand that could drive a sharp recovery in sales if macro and housing conditions improve, making near‑term returns highly dependent on the economic outlook.

Analysis

Home Depot is the undisputed leader in U.S. home improvement with $166 billion in trailing-12-month sales versus Lowe's $84.3 billion, yet the stock has materially underperformed the market: a 16.9% total return over three years (turning $10,000 into $11,690) compared with the S&P 500's 74.6% as of Nov. 22. The company moved from pandemic-era double-digit revenue growth in fiscal 2020-21 to weakening traffic and spend, with same-store sales down 3.2% in fiscal 2023, down 1.8% in fiscal 2024 and essentially flat in Q3 2025 (ended Nov. 2). Management attributes the slowdown to higher interest rates and constrained big-ticket consumer spending, while CEO Ted Decker highlights an estimated $50 billion cumulative under-spend in normal U.S. repair-and-remodel activity that could act as pent-up demand. Market signals are mildly negative (sentiment_score -0.35) with modest market-impact (0.3), indicating investor caution and that near-term performance will be driven by interest-rate and housing-cycle developments rather than company-scale advantages alone.

Key Decisions for Investors

• Consider underweighting Home Depot in benchmark-relative equity allocations until same-store sales show a durable inflection or mortgage/interest rates move decisively lower,
• If pursuing a recovery trade, size new exposure modestly and accumulate only after confirmed housing demand improvement or clear management evidence that the cited $50 billion under-spend is starting to convert to sales,
• Income-focused holders can continue to keep a position for dividends but should adjust return expectations given the three-year 16.9% total return versus the S&P's 74.6%,
• Use tactical hedges or options to protect existing exposure or express a leveraged recovery view given persistent macro risks; prioritize monitoring same-store sales, quarterly guidance and interest-rate trends as primary triggers for re-rating