The Home Depot, Inc. (HD) released its first quarter earnings report on Tuesday, May 20. The home improvement retailer reported sales that topped analysts’ expectations for the quarter, the company’s shares increased 1% following the report’s release.

Home Depot reported first quarter revenue of $39.86 billion, up 9.4% from $36.42 billion during the same quarter last year. Analysts’ expected revenue of $39.29 billion for the quarter.

“Our first quarter results were in line with our expectations as we saw continued customer engagement across smaller projects and in our spring events,” said Home Depot CEO, Ted Decker. “We feel great about our store readiness and product assortment as spring continues to break across the country, and I would like to thank our associates for their continued hard work and dedication.”

Home Depot reported quarterly net earnings of $3.43 billion or $3.45 per adjusted share. This was a decrease from net earnings of $3.60 billion or $3.63 per adjusted share during the same quarter last year.

The Atlanta, Georgia-based home improvement retailer reported that its comparable sales dropped 0.3% and U.S. comparable store sales increased 0.2% during the first quarter. The company noted that foreign exchange rates had an adverse impact, reducing total comparable sales by about 70 basis points. Home Depot also reported a rise of 2.1% in customer transactions during the quarter, and the average ticket price rose to $90.71. At the end of the first quarter the company had a total of 2,350 retail stores.

The Home Depot, Inc. (HD) shares ended the week at $362.71, down 3% for the week.

Target Misses Earnings Mark

Target Corporation (TGT) announced its first quarter earnings report on Wednesday, May 21. The retailer reported lower-than-expected revenue and earnings, causing the company’s shares to drop by more than 5% following the earnings release.

Target reported quarterly revenue of $23.85 billion. This was down 2.8% from revenue of $24.53 billion in the same quarter last year and below analysts’ expectations of $24.27 billion.

“In the first quarter, our team navigated a highly challenging environment and focused on delivering the outstanding assortment, experience and value guests expect from Target,” said Target CEO, Brian Cornell. “While our sales fell short of our expectations, we saw several bright spots in the quarter, including healthy digital growth, led by a 36% increase in same-day delivery through Target Circle 360, and our strongest designer collaboration in more than a decade, kate spade for Target.”

The company reported net income of $1.04 billion for the quarter or $2.27 per share. This is an increase from net income of $942 million or $2.03 per share in the same quarter last year.

Target’s total comparable sales decreased 3.8% in the quarter, as a result of a decline in comparable store sales of 5.7% and an increase in digital sales of 4.7%. During the quarter, Target opened 3 net new stores, bringing its total to 1,981. Target’s gross margin rate declined slightly to 28.2% compared to 28.8% in the first quarter of last year. The decline was attributed to the combined effect of merchandising factors, including increased markdown rates, digital fulfillment expenses, supply chain costs and the online launch of new supply chain facilities. Target cut its full-year sales outlook and now expects to earn between $7.00 to $9.00 per adjusted share in fiscal year 2025.

Target Corporation (TGT) shares ended the week at $94.29, down 3% for the week.

TJX Posts Earnings

TJX Companies, Inc. (TJX) released its first quarter earnings on Wednesday, May 21. The multinational off-price apparel and home accessories retailer delivered strong revenue, but its shares fell by nearly 3% following the release.

The company reported first quarter net sales of $13.11 billion, up 5% from $12.48 billion reported during the same quarter last year. This exceeded analysts’ expectations of $13.01 billion.

“I am very pleased with our first quarter performance,” said TJX Companies CEO, Ernie Herrman. “All divisions, both in the U.S. and internationally, drove increases in comp sales and customer transactions, which underscores the strength of our value proposition. I am as confident as ever that we will bring our value proposition to even more customers around the world and keep growing our sales and profitability over the long term.”

For the first quarter, TJX reported net income of $1.04 billion or $0.92 per diluted share. This was down from $1.07 billion or $0.93 per diluted share reported in the same quarter last year.

The Massachusetts-based parent company to T.J. Maxx, Marshalls and HomeGoods reported an increase in comparable store sales across all store segments, including an increase of 2% at Marmaxx and 4% at HomeGoods. At the end of the first quarter, TJX opened 36 new stores for a total of 5,121. The company returned $1.0 billion to shareholders through share repurchases and dividends during the quarter. TJX expects diluted earnings per share to be between $0.97 to $1.00 for the second quarter and between $4.34 to $4.43 for the full fiscal year 2026.

TJX Companies, Inc. (TJX) shares ended the week at $125.70, down 6% for the week.

The Dow started the week at 42,543 and closed at 41,603 on 8/23. The S&P 500 started the week at 5,903 and closed at 5,803. The NASDAQ started the week at 18,937 and closed at 18,737.

U.S. Treasury yields spiked midweek as investors awaited the outcome of the House vote on the President’s tax and spending legislation. Yields lowered towards the end of the week as a slight decline in jobless claims pointed to a stable labor market.

On Thursday, the House of Representatives narrowly advanced a large tax bill to the Senate in a 215-214 vote, after two consecutive nights of debate. The 1,100-page legislation includes tax cuts along with increased spending on the military and is projected to add nearly $4 trillion to the federal deficit. The bill also extends both corporate and individual tax cuts originally enacted under the 2017 Tax Cuts and Jobs Act.

“Short term, the tax bill is good for the economy,” said portfolio manager at Argent Capital Management, Jed Ellerbroek. “It reduces taxes for lots of people, it increases spending, especially on defense, and so those things are stimulative to the economy and are going to boost GDP growth. Long term, for the bad market, it is bad news. Yields are going higher, which means prices are going down because Treasuries are becoming incrementally less appealing and trustworthy, as our budget deficit stays extremely high for a very long period of time with no signs of it going back to normal.”

The benchmark 10-year Treasury note yield opened the week of May 19 at 4.48% and traded as high as 4.63% on Thursday. The 30-year Treasury bond opened the week at 4.95% and traded as high as 5.15% on Thursday.

On Thursday, the U.S. Department of Labor reported that initial claims for unemployment decreased by 2,000 to 227,000 for the week ending May 17, slightly below economists’ expectations of 230,000 claims. Continuing claims increased by 36,000 to 1.90 million.

“Employers have so far elected to keep their staff headcounts steady despite the swirling winds of unprecedented policy changes for the economy emanating from down in Washington,” said chief economist at FWDBONDS, Christopher Rupkey. “There is no serious deterioration in the labor market to date, and the economy is weathering the storm for now.”

The 10-year Treasury note yield finished the week of May 19 at 4.52% while the 30-year Treasury note yield finished the week at 5.04%.

Freddie Mac released its latest Primary Mortgage Market Survey on Thursday, May 22. According to the survey, the mortgage rates for 30-year and 15-year loans edged up again but continued to be slightly lower than a year ago.

This week, the 30-year fixed mortgage rate averaged 6.86%, an increase from last week’s average of 6.81%. Last year at this time, the 30-year fixed mortgage rate averaged 6.94%.

The 15-year fixed mortgage rate averaged 6.01% this week, up from last week’s average of 5.92%. During the same week last year, the 15-year fixed mortgage rate averaged 6.24%.

“Mortgage rates inched up this week but continue to remain lower than one year ago,” said chief economist at Freddie Mac, Sam Khater. “With more inventory for buyers to choose from than the last few years, purchase application activity continues to hold up.”

Based on published national averages, the savings rate was 0.42% as of 5/19. The one-year CD averaged 1.75%.

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