This…could be a problem. We know that home improvement giant Home Depot (HD) just agreed to spend big bucks to pick up GMS (GMS). And most figured it was a good idea, because it let Home Depot better move into the contractor space. But did you know there are several items contractors will not buy at Home Depot? A list of these recently emerged, and that could mean a problem going forward. But investors took it in stride; shares of Home Depot were up better than 2% in Friday 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.
On the list are some unexpected home improvement staples. Cabinets are a no-go on this list, reports note, because “local cabinetry dealers” are likely to prove a better buy, and offer installation services. Homestar Design Remodel’s Thomas Borcherding noted “Personally, I believe that Home Depot’s cabinetry services leave much to be desired in terms of both design and build quality.”
Also on the list were such basics as paint and flooring, along with fixtures, home appliances, and “ready-made doors and windows.” While this list does represent a certain subjective quality—there may be plenty of contractors who find Home Depot’s offerings in this field perfectly worthwhile—the fact that there are some contractors out there who are opposed suggests that Home Depot may need to get some outreach marketing efforts together to turn sentiment around.
Way Too Aggressive Driving
Then, in an unexpected twist, a man who not only stole merchandise from a Home Depot location near him, but also tried to hit store employees with his van in the process, was recently sentenced to eight years in prison.
Philip Sarner was convicted, and sentenced, to eight years in prison following what reports described as “…one count of robbery in the first degree while threatening use of a dangerous instrument and one count of criminal mischief in the fourth degree.” Sarner tried to pack a set of hand tools into a contractor’s bag and then headed for an emergency exit. Sarner was confronted by a Home Depot employee, who happened to be seven months pregnant at the time. Sarner abandoned a large portion of his loot, bolted, and jumped behind the wheel of a minivan, which belonged to his mother. He then drove threateningly toward several employees, who ultimately took cover behind a door.
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 14.34% rally in its share price over the past year, the average HD price target of $445.14 per share implies 6.44% upside potential.
