Zacks Investment Research Downgrades Home Depot (HD) to Hold

Home Depot (NYSE:HD) was downgraded by Zacks Investment Research from a “buy” rating to a “hold” rating in a research report issued on Thursday.

According to Zacks, “Home Depot outperformed the sector in the last six months attributed to its five-year long trend of beating earnings estimates, which continued in fourth-quarter fiscal 2017. Further, sales topped estimates for the sixth straight quarter. Results gained from strength in core business as well as relentless focus on affording innovative products, boosting interconnected customer experience and driving productivity. Steady housing market recovery and strong customer demand also remain tailwinds. Further, the company provided an optimistic view for fiscal 2018. Concurrently, it reiterated financial targets for fiscal 2020 and raised the return on invested capital target to reflect gains from the recent tax reform. However, gross margins continued to be soft due to impacts from lower margin hurricane-related sales. The company anticipates gross margins to decline in fiscal 2018, excluding the 53rd week, due to tight transportation market.”

Several other research firms have also weighed in on HD. Credit Suisse Group boosted their target price on shares of Home Depot from $183.00 to $222.00 and gave the company an “outperform” rating in a report on Wednesday, January 24th. Stifel Nicolaus boosted their target price on shares of Home Depot from $209.00 to $230.00 and gave the company a “buy” rating in a report on Thursday, January 25th. Telsey Advisory Group reiterated an “outperform” rating and issued a $220.00 target price (up from $190.00) on shares of Home Depot in a report on Friday, January 19th. Jefferies Group reiterated a “buy” rating and issued a $223.00 target price on shares of Home Depot in a report on Monday, February 5th. Finally, Oppenheimer reiterated a “buy” rating on shares of Home Depot in a report on Tuesday, December 26th. Two equities research analysts have rated the stock with a sell rating, six have assigned a hold rating, twenty-two have given a buy rating and one has given a strong buy rating to the company’s stock. The company currently has an average rating of “Buy” and an average target price of $192.12.

Home Depot (NYSE:HD) opened at $183.06 on Thursday. The company has a quick ratio of 0.39, a current ratio of 1.23 and a debt-to-equity ratio of 9.54. The firm has a market cap of $218,030.42, a PE ratio of 25.15, a price-to-earnings-growth ratio of 1.35 and a beta of 1.08. Home Depot has a fifty-two week low of $143.97 and a fifty-two week high of $207.60.

Home Depot (NYSE:HD) last posted its earnings results on Tuesday, February 20th. The home improvement retailer reported $1.69 earnings per share for the quarter, beating the consensus estimate of $1.62 by $0.07. The company had revenue of $23.88 billion for the quarter, compared to analyst estimates of $23.65 billion. Home Depot had a net margin of 8.55% and a return on equity of 263.30%. Home Depot’s revenue was up 7.5% on a year-over-year basis. During the same period in the previous year, the business posted $1.44 EPS. equities research analysts predict that Home Depot will post 9.47 earnings per share for the current fiscal year.

Home Depot announced that its Board of Directors has approved a share buyback plan on Wednesday, December 6th that permits the company to repurchase $15.00 billion in outstanding shares. This repurchase authorization permits the home improvement retailer to repurchase shares of its stock through open market purchases. Shares repurchase plans are generally an indication that the company’s management believes its stock is undervalued.

In other Home Depot news, EVP Matt Carey sold 41,396 shares of the stock in a transaction that occurred on Friday, December 8th. The shares were sold at an average price of $183.03, for a total value of $7,576,709.88. Following the sale, the executive vice president now directly owns 29,559 shares of the company’s stock, valued at approximately $5,410,183.77. The sale was disclosed in a legal filing with the SEC, which is available at the SEC website. Corporate insiders own 0.26% of the company’s stock.

Several hedge funds and other institutional investors have recently bought and sold shares of HD. Paragon Wealth Strategies LLC boosted its stake in Home Depot by 0.4% during the 2nd quarter. Paragon Wealth Strategies LLC now owns 1,825 shares of the home improvement retailer’s stock worth $280,000 after purchasing an additional 7 shares during the period. Jackson Grant Investment Advisers Inc. boosted its stake in Home Depot by 0.4% during the 2nd quarter. Jackson Grant Investment Advisers Inc. now owns 1,651 shares of the home improvement retailer’s stock worth $253,000 after purchasing an additional 7 shares during the period. Mcdaniel Terry & Co. boosted its stake in Home Depot by 0.5% during the 2nd quarter. Mcdaniel Terry & Co. now owns 1,678 shares of the home improvement retailer’s stock worth $257,000 after purchasing an additional 9 shares during the period. Cutter & CO Brokerage Inc. boosted its stake in Home Depot by 0.3% during the 2nd quarter. Cutter & CO Brokerage Inc. now owns 3,782 shares of the home improvement retailer’s stock worth $580,000 after purchasing an additional 10 shares during the period. Finally, Fort Pitt Capital Group LLC boosted its stake in Home Depot by 0.3% during the 2nd quarter. Fort Pitt Capital Group LLC now owns 3,444 shares of the home improvement retailer’s stock worth $528,000 after purchasing an additional 10 shares during the period. 70.36% of the stock is currently owned by hedge funds and other institutional investors.

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Home Depot Company Profile

The Home Depot, Inc (The Home Depot) is a home improvement retailer. The Company sells an assortment of building materials, home improvement products, and lawn and garden products, and provides various services. The Home Depot stores serves three primary customer groups: do-it-yourself (DIY) customers, do-it-for-me (DIFM) customers and professional customers.

Analyst Recommendations for Home Depot (NYSE:HD)

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