Home improvement giant Home Depot (HD) has seen better days. With economic troubles picking away at it, with consumers reconsidering all but the most necessary home projects, with the professional market looking wobbly and intensely competitive, there are a lot of reasons to be down on Home Depot. And now, CNBC analyst Jim Cramer is turning on it as well. That vote of no confidence was enough to send Home Depot plunging, down over 2.5% in Tuesday morning’s trading.
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Jim Cramer has a charitable trust running, and Home Depot is one of the stocks in which it is invested. But Cramer may actually be reconsidering that position, as he recently revealed. In fact, Cramer noted that he was “very disappointed” in Home Depot, as it recently hit a 52-week low. He wondered if now was actually a good time to buy in, thanks to its 3% yield, but the trust was “…a little beaten down on it.”
Cramer elaborated, “We didn’t want to buy it anymore right now. We need to see mortgage rates lower, and we don’t have them yet. I’m not giving up on Home Depot, but there are issues involving ICE, too, that really hurt them. But I do want to say that I regard it now as one of the most problematic positions in my portfolio, along with Nike (NKE). Those are the two I’m most worried about.”
Black Friday, But In Spring
Likely as a response to its declining fortunes in the market, Home Depot is launching a Spring Black Friday sale, hoping to get customers in the door and buying things at significantly lower prices over normal. The sale starts April 9, reports note, and will include a range of deals. Home Depot leaked its Spring Black Friday sale flier, and in so doing, told us what to expect.
Plants and patio furniture will be front and center for the big sale, which is not surprising. The weather is finally turning a corner, and being outside for extended periods will no longer be potentially lethal in many places. Yard tools will also be extensively represented, with lawn mowers, weed trimmers, pressure washers and more on hand.
Is Home Depot a Good Long-Term Buy?
Turning to Wall Street, analysts have a Strong Buy consensus rating on HD stock based on 17 Buys and three Holds assigned in the past three months, as indicated by the graphic below. After a 2.56% loss in its share price over the past year, the average HD price target of $425.06 per share implies 33.83% upside potential.
