Home Depot (HD - Free Report) closed at $232 in the latest trading session, marking a -0.71% move from the prior day. This move was narrower than the S&P 500's daily loss of 0.9%. Meanwhile, the Dow lost 0.58%, and the Nasdaq, a tech-heavy index, lost 0.93%.
Prior to today's trading, shares of the home-improvement retailer had gained 5.81% over the past month. This has outpaced the Retail-Wholesale sector's gain of 2.75% and the S&P 500's gain of 3.3% in that time.
Investors will be hoping for strength from HD as it approaches its next earnings release, which is expected to be February 25, 2020. The company is expected to report EPS of $2.10, down 6.67% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $25.76 billion, down 2.74% from the year-ago period.
For the full year, our Zacks Consensus Estimates are projecting earnings of $10.08 per share and revenue of $110.20 billion, which would represent changes of +1.92% and +1.85%, respectively, from the prior year.
It is also important to note the recent changes to analyst estimates for HD. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.
Our research shows that these estimate changes are directly correlated with near-term stock prices. 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. The Zacks Consensus EPS estimate remained stagnant within the past month. HD is currently sporting a Zacks Rank of #4 (Sell).
In terms of valuation, HD is currently trading at a Forward P/E ratio of 23.19. This valuation marks a premium compared to its industry's average Forward P/E of 14.69.
Meanwhile, HD's PEG ratio is currently 2.06. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Building Products - Retail industry currently had an average PEG ratio of 1.37 as of yesterday's close.
The Building Products - Retail industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 97, which puts it in the top 39% 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.