Having kept a close eye on this stock for more then 20 years, I have seen the culture evaporate over the last 15 years. They have taken a path of alienating customers and former associates as well. Their hiring for low wages at the expense of knowledge. New associates are no better prepared then convenience store clerks to help with projects. The outlook is even worst then when they were trading at $28 a share. Associates moral is at all time lows and look for Unionization of associates and managers as unaviodable. How bad is it? If associates speak to customers as to how bad it really is, they can be terminated from employment. Their cost for certain Install projects has saved the company at the expense of their customers with availability of credit and extra high pricing. Watch for increased lawsuits due to treatment of their associates. The list of warnings that will lead to the downfall are too numerous to mention here. Shorts should be eying this as a potential opportunity.
Sentiment: Strong Sell
I`ve been in HD stores the past year in NJ, Virginia, DE, PA, NC, SC and AL.... Yes none of them are as busy as they were in 2005.... but all of them are busier than what they were and the people I`ve talked to on their floor have all said the same thing -- business is picking up.... slow but sure...
itsawhiz, of all of the warnings which you are fully knowledgable of, is it possible that you could divulge some names or numbers of stores where all of this is taking place. Or, on your word alone are we expected to sell all and start trading with some other stores which I am sure you are willing to recommend. The long term outlook from what I see is very different from what you are being made aware of. The culture has changed over the past period of time, from being inexperienced handy men who now are the main contractors and big time contractors, the home owners are far more capable of doing work around the house and the ladies have their own classes.To top it off we are teaching the children of our customers how to use tools and build different projects. They, those children are our future customers. There is excellent management from the top to the bottom in every store that is local in this area and they continue to pay success sharing checks. Have a good holidays you and your family.
Boggs, Unfortunately, I will not recommend another choice for you. I will expand on a few things you mentioned. The "culture" which you are refer to is different then the culture I make mention. What you are referring to is your customer base. Home Depot is now more focused on Contractor business and Install services. You may believe that Homeowners are now more suitable to perform Home Improvements for themselves then they were 15-20 years ago. I disagree. Your Kids Workshops though admirable are merely a "Outing for Parent and Child" purely uneducational for children who are unlikely to even remember the occasion or make them feel confident enough to take on projects when they are older. Building a prefabed Birdhouse or Box doesn't constitute, in my opinion, a long lasting impression that the child will be apt to perform Home Improvement projects.
As for Success Sharing, let me put it into perspective for people who are unaware of what that entails. First, Store management teams have no input into what the goals should be to success share. Which is based on each individual stores sales and, in case of management, profitability and Inventory management. These checks to associates are scaled based on how well the store does. In many cases the check amount, for a full time associate that bonuses, is less then $100 per year. Of course, prior to the establishing of the 401k and success sharing, Home Depot associates were given what was called Employee Stock Ownership Plan or ESOP. At the end of every year, based on the companies performances and each individuals performance, the company provided HD shares in an amount typically equal to 10% of an associates salary that had a vesting period for new associates less then 5 years. Most associates received amounts equal to $2500 in shares of HD stock.
As for management in the stores, I believe there are SOME wonderful people working at store and corporate levels. I say wonderful people, because individually personally they could be truly dedicated to the livelihoods of others. As for their knowledge of the business, merchandising, and operations the business they are more puppets then Managers. They are not required to be creative or drive sales based on local areas needs. All this has been changed on the muse of getting each store universal as to where products are located and what is on each endcap in the stores and as far as where every beam should be placed along with what the sign should say. They call it "Map". Right down to the clipstrips on each upright and the wingstacks in each aisle. Not to mention shadowboxes, which are also dictated. This maybe wonderful for Inventory control, maybe also for the secret Apple program of mapping the stores, but the downside is that it hurts sales generation and inhibits the "Taking Ownership Attitude" which promotes sales, confidence, happiness of associates and learning of customers desires or needs.
I can expand upon this, although, I have already spent to much valuable time and effort in establishing the creditability of my opinion that Home Depot current value is overrated.
In closing, the culture of taking care of their associates is lost in years and though HD trying to manipulate their associates thought process to think they do everything they can to make them happy is just a curtain throw over their eyes. Many associates are becoming more and more aware of this curtain.
May you and your family also have a very happy Holiday. For me its Christmas, which HD doesn't allow their managers to call what they consider to be their "Holiday Party" which was original known as "The Christmas Party" and that's a whole other story of less for associates.
MERRY CHRISTMAS TO ALL AND TO ALL A GOOD NITE
Sentiment: Strong Sell
MY 50 YEARS OF "VERY SUCCESSFUL RESULTS" , ASSURES ME, THAT I, "BUG THE GREAT", KNOWS THE STOCKS I PICK WILL OF COURSE BE PROFITABLE!!!!
I HAVE NO REASON TO THINK OTHERWISE!!!
O.N.C.S.; IS JUST NOW REACHING ITS STRIDE AND WILL CONTINUE TO GAIN ":VALUE" AND "RESPECT " IN THE MARKET PLACE IN WHICH THE CHOSE TO COMPETE!!
A PARTNER OR PARTNERS WILL JOIN US VERY SOON!!!
GOOD LUCK TO ALL! FROM , B.T.G.!!!
Everyone has a opinion, realistically, THD current trend is unsustainable, If you are okay with their purposely termination of long term associates, tightening of Rules of conducts, disregard to the knowledge of applicants, Inferior training programs and overcharging trusting customers for installed services. I can continue. I have an in depth knowledge of the operations and history. Better then the analyst covering the company.
Disclosure: I have no position in this stock and I would not buy it
Sentiment: Strong Sell