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Home Depot Called 'The Best House' On The Retailer Block

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Home Depot Called 'The Best House' On The Retailer Block

Despite a solid earnings report this week from Home Depot Inc (NYSE: HD), shares have failed to deliver any meaningful gains as investor fears of the Amazon.com, Inc. (NASDAQ: AMZN) effect proliferates nearly every retailer. Despite these fears, it may be short sighted to place those trepidations on the world's largest home retailer.

Baird: Outperform Rated, $175 Price Target

“The market’s general disdain for retail stocks continues to encourage a selective approach to the group, and we see upside for patient investors as HD’s superior fundamentals should continue to warrant a premium valuation to the market,” said Baird Equity Research's Peter S. Benedict.

Some bright spots in the quarter included comps, which at U.S. stores increased 6.6 percent in the quarter, and online sales, which grew 23 percent year over year. With 40 percent of online transactions picked up in the store, Benedict believes that physical stores remains a key piece of the omni-channel approach to home improvement retail.

Baird Equity Research maintains an Outperform rating on Home Depot, with a $175 price target.

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Bank Of America: Buy, $180 PT

Bank of America analyst Denise Chai called Home Depot 'The best house on the retail block' as the current housing cycle is expected to drive earnings higher. Bank of America reiterated a Buy rating on Home Depot with an $180 price objective.

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UBS: Buy, $175 PT

UBS key takeaway from the quarter was that it believes Home Depot can maintain its comp performance.

Big ticket items (transactions above $900) are growing an impressive 12.4 percent, indicating consumers may prefer to opt out in using e-commerce for either big purchases due to the various complications that can arise buying a product before seeing it in person. “We believe its modest small ticket growth of 1.5 percent means its customers are building bigger baskets at HD rather than losing these sales to AMZN,” said UBS analyst Michael Lasser

UBS maintains its Buy rating on Home Depot following the quarter, keeping its price target at $175.

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Related Links:

Kevin Kelly's Bullish Home Depot Trade

Pete Najarian Is A Buyer Of Home Depot

Latest Ratings for HD

DateFirmActionFromTo
Oct 2019AssumesOutperform
Sep 2019MaintainsOutperform
Sep 2019DowngradesHoldSell

View More Analyst Ratings for HD
View the Latest Analyst Ratings

Posted-In: Analyst Color Earnings Long Ideas News Guidance Reiteration Analyst Ratings Trading Ideas Best of Benzinga

 

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