An unexpected win for home improvement stock Home Depot (HD) emerged today as notorious stock analyst Jim Cramer of CNBC fame stepped in to declare Home Depot a good buy. This did nothing for investors, though, who promptly sold in droves, sending Home Depot shares down nearly 2% in Tuesday afternoon’s trading.
Elevate Your Investing Strategy:
- Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence.
- Make smarter investment decisions with TipRanks' Smart Investor Picks, delivered to your inbox every week.
Cramer’s logic was oddly sound. Cramer, not incorrectly, pointed out that Home Depot is virtually “…synonymous with the housing market.” He further pointed out that “…the housing market stinks.” This might be a bit more debatable. But Cramer then noted that he, and those involved with what he called the “Charitable Trust,” have been buying in on Home Depot for some time now. Cramer notes that Home Depot is not just about home sales, but much more about home renovation, a point we raised yesterday in discussing Home Depot.
Cramer declared that people were largely uninterested in Home Depot unless it looked like it was closing in on a new high. That would be a bad idea, Cramer noted, summing it up with one pithy pair of sentences: “They want to buy Home Depot when it’s hot. I want to buy Home Depot when it’s not.”
ICEBlock Steps In
Home Depot stores have become a new battleground for illegal immigration, as many illegal immigrants find work by standing around the parking lots and waiting to help someone with whatever home improvement project they are buying material for at the Home Depot. That is where ICEBlock steps in and makes the picture a little murkier and a little more dangerous.
ICEBlock is an app that allows users to “…report and view real-time sightings of ICE agents within a five-mile radius.” That in turn is drawing fire from the federal government, who consider it more a way to “…compromise…immigration enforcement and endanger…federal agents.” Since ICE is often seen descending on Home Depot these days—for the reason in question—that is prompting safety concerns about going to Home Depot stores and potentially getting caught in an ICE raid.
Is Home Depot a Good Long-Term Buy?
Turning to Wall Street, analysts have a Strong Buy consensus rating on HD stock based on 18 Buys and six Holds assigned in the past three months, as indicated by the graphic below. After a 0.27% rally in its share price over the past year, the average HD price target of $430.44 per share implies 18.81% upside potential.
