Chip stocks fall with Nvidia after data center rev disappointment
On Thursday, BofA Securities analysts upgraded Wilcon Depot Inc. (WLCON:PM) stock rating to neutral from underperform. The analysts also adjusted the price target to PHP7.60 from PHP13.00.
The change comes after Wilcon Depot’s year-to-date underperformance of 48%, which has now factored in a prolonged demand slump in the home improvement sector. The analysts noted that first-quarter indicators suggest a potential stabilization in same-store sales growth, reducing the likelihood of further downside risk for Wilcon Depot stock.
Despite expectations that Wilcon Depot’s profit recovery will trail behind regional home improvement peers, the company’s solid balance sheet, characterized by no debt, and strong free cash flow generation are seen as mitigating factors against a prolonged downturn.
The analysts’ price objective positions Wilcon Depot in line with regional peers at a 14 times fiscal year 2025 estimated price-to-earnings ratio, which is two standard deviations below its historical mean. A re-rating of the stock is expected to depend on the recovery trajectory of its demand.
Wilcon Depot’s financial health and market position remain focal points for investors as they navigate the current economic landscape in the home improvement industry.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.