Core Insights - The article emphasizes the importance of understanding that past performance does not guarantee future results, highlighting the need for careful analysis before making investment decisions [2][3] Group 1 - The article discusses the role of analysts in providing insights and opinions on various companies and industries, noting that these opinions may not reflect the views of the platform as a whole [3] - It mentions that analysts may include both professional and individual investors, which can lead to a diverse range of perspectives [3] - The content is presented as educational and illustrative, rather than as specific investment advice [2] Group 2 - The article clarifies that there are no current stock or derivative positions held by the authors in the companies mentioned, ensuring a level of impartiality in the analysis [1] - It states that the information provided is believed to be factual and up-to-date, but does not guarantee its accuracy, indicating the need for further research by investors [2] - The article underscores that no specific offers to buy or sell securities are being made, reinforcing the educational nature of the content [2]

Group 1 - The Home Depot, Inc. is initiated with a Hold rating and a price target of $343, operating the largest home improvement retail chain in the U.S. [1] - The company services both homeowners and a loyal customer base, indicating a strong market position [1]. Group 2 - Moretus Research focuses on U.S. public markets, applying a structured framework to identify companies with durable business models and mispriced cash flow potential [1]. - The research emphasizes rigorous fundamental analysis and a judgment-driven process, avoiding noise and overly complex forecasting [1]. - Valuation is based on sector-relevant multiples tailored to each company's business model, emphasizing comparability and relevance [1].

Retail Sector Overview - Investors are increasingly nervous about the retail sector due to concerns over tariffs impacting consumer spending and the potential for a recession [1] - The S&P 500 Retail Composite has declined by 1.8% year-to-date as of June 18, while the S&P 500 index has increased by 1.7% [1] Home Depot - Home Depot is the leading home improvement retailer, generating approximately $160 billion in sales from nearly 2,350 stores in the latest fiscal year [3] - The company faces challenges tied to the broader economy and housing market, with same-store sales falling by 0.3% in the fiscal first quarter ending May 4, and management projecting a modest 1% growth for the year [4] - Despite a 1.9% decline in stock price over the past year, Home Depot's P/E ratio remains at 24, lower than the S&P 500's 29 [6] Target - Target has experienced sales declines due to macroeconomic factors and tariff policies, with fiscal first-quarter same-store sales dropping by 3.8% [7][8] - The company has lowered its earnings expectations for the year, projecting adjusted earnings per share between $7 and $9, down from a previous range of $8.80 to $9.80 [9] - Target's stock price has decreased by over 33% in the last year, with its P/E ratio falling from 16 to 10, presenting a potential buying opportunity for patient investors [10]

Core Insights - Home Depot Inc. is experiencing strength in smaller-scale DIY and maintenance projects, but a revival in big-ticket remodel and renovation spending is necessary for sustained top-line growth [1][3] - Big-ticket sales grew only 0.3% in Q1 fiscal 2025, contributing to a 0.3% decline in overall comparable sales, with U.S. comps up just 0.2% [2][9] - The company anticipates continued pressure on big-ticket renovations due to no major improvement expected in interest rates or housing turnover in 2025 [3] Company Strategy - Home Depot is positioning itself to capture future spending surges through financing options for professionals and streamlined lending tools for consumers [4] - The company is maintaining high in-stock rates for building materials to fulfill large orders promptly when market conditions improve [4] Market Context - Competitors like Lowe's and Walmart are also facing challenges in big-ticket categories, with cautious consumer behavior impacting discretionary purchases [6][7][8] - A recovery in big-ticket demand is critical for both Home Depot and its competitors, as it can significantly influence overall revenues and growth strategies [7][8] Financial Performance - Home Depot's shares have declined 10.8% year-to-date, compared to a 13.9% decline in the industry [11] - The forward price-to-earnings ratio for Home Depot is 22.31X, higher than the industry's 19.68X, indicating a premium valuation [12] - The Zacks Consensus Estimate for fiscal 2025 earnings implies a year-over-year decline of 1.3%, while fiscal 2026 estimates indicate a growth of 9.2% [14]

Is home improvement giant Home Depot (HD -0.50%) stock a buy on the dip? If you're looking for a great value stock, Home Depot stock looks priced to buy today.The market is hovering just north of flat for the year, and there's a tentative confidence in the economy. Many tariff issues have been worked out for now, and U.S. companies are demonstrating resilience. However, it's fragile. With interest rates still high and the real estate market still low, many companies, specifically related to the housing mark ...

Core Insights - Home Depot serves as a significant economic barometer, reflecting consumer confidence and spending patterns in the housing market [1][2][10] Group 1: Customer Segments - The company has two distinct customer segments: Do-It-Yourself (DIY) consumers and Professional (Pro) contractors, each providing different economic signals [2][5] - DIY spending reflects household financial confidence, with larger projects indicating optimism and access to credit [3][8] - Pro contractors, generating about half of Home Depot's revenue, focus on essential needs, providing a more stable economic signal [5][6] Group 2: Current Trends - Recent data shows a divergence in spending, with Pro customer spending outpacing DIY spending, indicating a moderating but stable economy [7][9] - The softness in the DIY segment is attributed to high-interest rates, leading homeowners to hesitate on large discretionary renovations [8][12] - Strong demand from Pro contractors suggests ongoing essential maintenance and construction projects, indicating economic stability [9][12] Group 3: Stock Outlook - The stock has underperformed compared to the broader market, reflecting the consumer slowdown [10][13] - Home Depot's strategic focus, including the acquisition of SRS Distribution, strengthens its position in the resilient Pro segment [12] - The company offers a reliable dividend yield of approximately 2.66% and a consistent share repurchase program, appealing to investors [12][14] Group 4: Economic Considerations - The aging U.S. housing stock, with over 50% of homes over 40 years old, supports ongoing demand for maintenance and repairs [6][14] - A significant decline in home prices could negatively impact consumer wealth and delay large renovation projects [14]

It has been about a month since the last earnings report for Home Depot (HD) . Shares have lost about 6.4% in that time frame, underperforming the S&P 500.Will the recent negative trend continue leading up to its next earnings release, or is Home Depot due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.How Have Estimates Been Moving Since Then?It turns ...

In the high-stakes arena of home improvement retail, two titans dominate the landscape — The Home Depot Inc. (HD) and Lowe’s Companies, Inc. (LOW) . These industry heavyweights have long been locked in a competitive duel, each carving out a formidable presence in a sector that thrives on consumer demand for housing upgrades, DIY trends and professional construction projects. While both operate within the same core business — selling tools, appliances, building materials and services — their strategic playbo ...

Group 1 - Ken Langone, co-founder of Home Depot, expressed concerns about the American economy and markets, highlighting the importance of maintaining the country's status in the global economy [1] - The national debt is currently over $36 trillion, with an increase of approximately $1 trillion annually in interest payments, which Langone described as "scary" [2][3] - The Federal Reserve is expected to announce its decision on interest rates, with the current target range being 4.25% to 4.5%, unchanged since December [5] Group 2 - Langone advised against further interest rate cuts, citing geopolitical tensions and economic indicators that suggest a slowdown, including weak retail sales and manufacturing data [4] - Concerns were raised about the integrity of U.S. debt, with Langone noting that the inability to float a 20-year bond is a dangerous signal for the economy [6]

The Zacks Retail-Home Furnishings industry is showing positive momentum in 2025, supported by stable mortgage rates, improved consumer confidence, and a rebound in housing activity. Digital platforms are driving growth with AR shopping tools, AI-powered personalization, and mobile-first strategies that appeal to Gen Z and millennials. Companies like The Home Depot, Inc. (HD) , Lowe's Companies (LOW) , Williams-Sonoma, Inc. (WSM) and The Lovesac Company (LOVE) have been leveraging product reinvention, effici ...