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Investing.com - Truist Securities has raised its price target on Home Depot (NYSE:HD) to $433.00 from $417.00 while maintaining a Buy rating on the stock. The retail giant, currently trading at $402.89 with a market capitalization of $401 billion, has shown strong momentum with a 15.85% return over the past year. According to InvestingPro analysis, the stock is currently trading above its Fair Value.
The price target increase represents a 28x multiple on Truist’s forward twelve-month earnings per share estimate, which maintains approximately a 20% premium to the broader market. The firm’s earnings estimates for Home Depot remain unchanged. The company’s current P/E ratio of 27.2x reflects this premium positioning, supported by robust annual revenue of $163 billion and a healthy gross profit margin of 33.3%.
Truist believes Home Depot is well-positioned to continue gaining market share in the home improvement sector regardless of macroeconomic conditions. The firm noted that Home Depot appears comfortable with its ability to manage tariffs without implementing widespread price increases, citing the company’s strong buying power and diversified sourcing capabilities.
The research firm highlighted Home Depot’s "Complex Pro" initiative, describing it as still in early stages but ultimately expected to generate substantial share gains and incremental growth for the company.
Truist remains bullish on Home Depot stock, pointing to its solid core business, potential upside from the Complex Pro program, and building pent-up demand driven by an aging housing stock and what it terms the "golden handcuff opportunity." The company’s strong market position is further reinforced by its 39-year track record of consistent dividend payments, currently yielding 2.32%. For deeper insights into Home Depot’s valuation and growth prospects, investors can access comprehensive analysis through InvestingPro, which offers additional exclusive ProTips and detailed financial metrics.
In other recent news, Home Depot has been active with several key developments. The company announced it has withdrawn and refiled its Premerger Notification and Report Form under the Hart-Scott-Rodino Act for its pending acquisition of GMS Inc., allowing more time for the U.S. Department of Justice’s review. The acquisition, valued at approximately $5.5 billion, has been positively received by Truist Securities, which reiterated a Buy rating on Home Depot, citing potential synergies and cyclical recovery benefits. Fitch Ratings has affirmed Home Depot’s A rating, indicating that the acquisition will only modestly impact the company’s financial leverage.
In the appliance category, Home Depot continues to gain market share, as reported by Stifel, highlighting a pricing acceleration in this sector. The appliance category represents a significant portion of Home Depot’s revenue, underscoring its importance. Additionally, Telsey Advisory Group has reiterated its Outperform rating on Home Depot, maintaining a price target of $455.00, with expectations of a return to positive comparable sales growth in upcoming periods. These developments reflect Home Depot’s strategic maneuvers and market positioning in recent times.
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