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Why BofA Is Turning Bullish On Retailer At Home

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Why BofA Is Turning Bullish On Retailer At Home

BofA Securities upgraded At Home Group Inc (NYSE: HOME) from Underperform to Buy and raised price target from $5 to $16.

Analyst Curtis Nagle said there is sustainability in home-related trends and listed the following as reasons for the upgrade:

  • At Home is going beyond industry sales expectations
  • Leverage will be lower after the second quarter
  • At Home’s valuation is more attractive with the new estimates in store
  • At Home reported Q2 results with an EBITDA that slightly topped the earnings from FY19

“We believe a higher multiple is warranted on higher confidence on sales/ EPS growth through the next 2-3yrs,” the analyst said. 

Nagle named the following investment takeaways on the stock:

  • People are spending more towards their homes and away from travel and entertainment.
  • At Home stores are staying stable, even in states with high virus counts.
  • Lastly, At Home is using cash made in the second quarter to pay off $228 million in short-term debt.

BofA raised its 2021 EPS estimate from 8 cents to $1.43.

HOME Price Action: The stock was down 2.78% at $12.25 at last check Friday. 

Public domain photo via Wikimedia

Latest Ratings for HOME

DateFirmActionFromTo
Jul 2020B of A SecuritiesUpgradesUnderperformBuy
Jul 2020JefferiesMaintainsHold
Jun 2020Morgan StanleyMaintainsEqual-Weight

View More Analyst Ratings for HOME
View the Latest Analyst Ratings

 

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Posted-In: BofA Securities Curtis Nagle retailAnalyst Color Upgrades Price Target Analyst Ratings

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