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Home Depot Stock Is Best-in-Class. Why Right Now Is the Time to Buy, According to Analysts -- Barrons.com Home Depot Stock Is Best-in-Class. Why Right Now Is the Time to Buy, According to Analysts -- Barrons.com Dow Jones By Lisa Beilfuss It's time to build a position in Home Depot stock, analysts at Wells Fargo say. Shares in the home-improvement retailer are down 7.5% over the past month, thanks to third-quarter sales that came in lower than expected and disappointing forecasts by management. That's as the S&P 500 is up 1.6% over the same time frame. "As sentiment sours, we're buyers into analyst day," Wells Fargo analysts wrote in a client note Monday. Home Depot's (ticker: HD) next conference for analysts and investors starts at 9 a.m. ET on Wednesday, Dec. 11. "We believe the Analyst Day overhang is peaking, and see opportunities for post-event relief should [fiscal year 2020] commentary prove better than feared," they added. To recap, the company on Nov. 19 said sales in the third quarter rose 3.5% from a year earlier to $27.22 billion, short of the $27.53 billion analysts surveyed by FactSet had predicted. At the same time, Home Depot said full-year sales would grow 1.8% from a year earlier, down from an earlier forecast of 2.3%. Chief Executive Craig Menear said certain strategic investments were taking longer than expected to pay off. Wells Fargo says strategic investments remain top of mind for investors. They see an uptick in the company's current investment plan, but think profit margins will remain stable. Going into this week's event, the analysts reiterated their Overweight rating on Home Depot's stock. They call the company "a best-in-class operator with a strong management team and track record for exceeding stated goals." It's worth noting that Wells Fargo did lower their price target on the stock -- to $240 a share from $260 -- but that still represents significant upside as the stock last closed at $214.28. |
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