10:45 AM EDT, 08/20/2025 (MT Newswires) -- Home Depot's ( HD ) Q2 results showed a modest underlying improvement amid continued weakness in large discretionary projects, RBC Capital Markets said in a Tuesday note.

"2Q results provided some evidence of improved underlying

demand, which paired with a strong exit rate will likely keep shares in favor so long as the current rate outlook remains unchanged," the report said.

RBC now expects comparable sales growth of 1% for 2025 and 3.2% for 2026, against 1.2% and 3.6% previously. Adjusted EPS is now forecast at $14.98 for 2025 and $16.03 for 2026, up from $14.97 and $15.94 previously.

"Directionally EPS growth seems poised to accelerate from here," it said. "Timing and magnitude are the biggest swing factors."

RBC raised its price target to $401 from $399 while keeping its sector perform rating on the stock.

Price: 404.31, Change: -2.89, Percent Change: -0.71