Analyst Zhihan Ma from Bernstein maintained a Hold rating on Home Depot and keeping the price target at $362.00.
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Zhihan Ma has given his Hold rating due to a combination of factors including the muted expectations for Home Depot’s growth in the home improvement market and below expectation EPS growth. While the company has outlined a scenario for higher sales growth in the long term, the expected earnings growth remains modest, which does not fully align with market expectations.
Additionally, Home Depot’s strategic focus on expanding its Complex Pro category is seen as a positive long-term approach, but the associated costs and the current housing market downturn have impacted its financial flexibility. The company’s reliance on a macroeconomic recovery and the potential for further acquisitions to drive growth are seen as key factors that could influence its future performance. In the short term, other companies like Lowe’s are perceived to have a more attractive valuation and cost-saving potential, making them preferable options.
In another report released yesterday, Stifel Nicolaus also maintained a Hold rating on the stock with a $350.00 price target.