Benzinga's PreMarket Prep airs every morning from 8-9 a.m. ET. During that fast-paced, highly informative hour, traders and investors tune in to get the major news of the day, the catalysts behind those moves and the corresponding price action for the upcoming session.

On any given day, the show will cover at least 20 stocks determined by co-hosts Joel Elconin and Dennis Dick along with producer Spencer Israel.

When a company has a blowout earnings report, investors must decide if the trend will continue or if it's a one-off. That is the dilemma Home Depot (NYSE:HD) shareholders are confronting making it the PreMarket Prep Stock Of The Day.

What A 2020: After ending 2019 at $218.38, Home Depot went on to make a new all-time high in February at $247.36 and then cratered with the broad market. The issue bottomed in March at $140.63 and began to rebound. That low came in between its February ($136.33) and March ($145.83) of 2017.

Once the issue made a new all-time high in March, the pace of the rally accelerated. It didn't peak until October ($292.66) and succumbed to end the year at $265.62, higher by 3.4%. Not a stellar return, but there was more to come.

Trading Range Early And A Rip Higher: For the first two months of this year, Home Depot was stuck in a trading range from $254.03 to $285.77. It breached the lower end of the range in early March, falling to $246.59 and then embarked on a relentless move higher.

In fact, the issue traded higher in 14 of the next 16 sessions, rallying from the close on March 5 ($253.52) to end the March 29 session at $302.20. Following a brief pause, the issue didn't peak until May 10 ($345.69) and posted its all-time closing high the same day at $341.12.

Street Selling Ahead Of Report: After making its all-time high, Home Depot was lower in four of the next five sessions leading up to Tuesday’s report. The low for the retreat was made on Monday at $315.31 and rebounded to end the session at $320.01.

Before the open, the company reported quarterly earnings of $3.86 per share, which beat the analyst consensus estimate of $3.07. The company reported quarterly sales of $37.50 billion, which beat the analyst consensus estimate of $34.89 billion.

It should be noted the company did not provide any forward guidance at the time of this article being written.

Price Action And PreMarket Prep Take: When the issue was being covered during the show, it was trading at the $326 area, a level not reached yet in Tuesday’s session. Dennis Dick stated his thesis clearly: “This is as good as it gets for Home Depot and Lowe’s. High lumber prices is going to cause people to delay construction products.”

Following a higher open ($329), the issue sprinted to $324.56 and sharply reversed course. The ensuing decline found support just under Monday’s low ($315.31). As of 12 p.m., it has rebounded into the mid-$318 handle.

The discussion on Home Depot from Tuesday’s show can be found here. For more commentary on retail earnings in general, go back to the six-minute mark.