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Home Depot (HD) Outpaces Stock Market Gains: What You Should Know
Home Depot (HD - Free Report) closed the most recent trading day at $283.91, moving +0.46% from the previous trading session. This move outpaced the S&P 500's daily gain of 0.3%. At the same time, the Dow added 0.24%, and the tech-heavy Nasdaq gained 0.34%.
Prior to today's trading, shares of the home-improvement retailer had lost 4.62% over the past month. This has lagged the Retail-Wholesale sector's loss of 3.15% and the S&P 500's loss of 1.21% in that time.
Home Depot will be looking to display strength as it nears its next earnings release. In that report, analysts expect Home Depot to post earnings of $3.86 per share. This would mark a year-over-year decline of 5.62%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $38.72 billion, down 0.48% from the year-ago period.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $15.85 per share and revenue of $157.22 billion. These totals would mark changes of -5.03% and -0.11%, respectively, from last year.
Any recent changes to analyst estimates for Home Depot should also be noted by investors. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.
Based on our research, we believe these estimate revisions are directly related to near-team stock moves. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 5.99% lower. Home Depot is holding a Zacks Rank of #4 (Sell) right now.
Investors should also note Home Depot's current valuation metrics, including its Forward P/E ratio of 17.83. This valuation marks a premium compared to its industry's average Forward P/E of 11.96.
Meanwhile, HD's PEG ratio is currently 1.59. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Building Products - Retail was holding an average PEG ratio of 1.59 at yesterday's closing price.
The Building Products - Retail industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 32, which puts it in the top 13% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
You can find more information on all of these metrics, and much more, on Zacks.com.