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Home Depot To See Sales Stabilization And EPS Growth In 2024, Analyst Builds Bull Case

Published 04/01/2024, 18:29
Updated 04/01/2024, 19:40
© Reuters.  Home Depot To See Sales Stabilization And EPS Growth In 2024, Analyst Builds Bull Case

Benzinga - by Lekha Gupta, Benzinga Editor.

Barclays analyst Seth Sigman upgraded The Home Depot Inc (NYSE: HD) to Overweight from Equal-Weight at an increased price target of $372 from $325.

The analyst is bullish on increased exposure to housing and potentially strengthening home prices as rates reverse.

Sigman notes stabilizing sales and a return to normal algorithmic-like growth in 2025 would support the stock.

The analyst expects comps to remain weak in low-single-digits in the near term but stabilize through 2024.

The analyst expects gross margin to be relatively stable, while SG&A is projected to benefit from $500 million of fixed cost reductions and cycling incremental costs in 2023.

The analyst estimates FY24 EPS of $15.47 (vs. consensus $15.62), thanks to comps and SG&A rate.

The analyst models comps down slightly vs. consensus flat, including negative in H1, with a slight improvement in H2, partially offset by an extra week (estimates ~$2.5 billion in sales).

The analyst raised FY25 EPS estimates slightly to $16.61 (up from $16.54), in line with the consensus.

Also Read: Home Depot Exceeds Expectations with Strong Performance, Driving Profits and Rewarding Investors

Price Action: HD shares are trading higher by 0.49% at $339.92 on the last check Thursday.

Photo via Company

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© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

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