In the latest trading session, Home Depot (HD) closed at $225.41, marking a -0.37% move from the previous day. This move was narrower than the S&P 500's daily loss of 0.84%. Meanwhile, the Dow lost 0.53%, and the Nasdaq, a tech-heavy index, lost 1.47%.
Prior to today's trading, shares of the home-improvement retailer had gained 3.48% over the past month. This has lagged the Retail-Wholesale sector's gain of 4.13% and the S&P 500's gain of 5.2% in that time.
HD will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $2.52, up 0.4% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $27.46 billion, up 4.4% from the year-ago period.
For the full year, our Zacks Consensus Estimates are projecting earnings of $10.11 per share and revenue of $110.72 billion, which would represent changes of +2.22% and +2.33%, respectively, from the prior year.
Any recent changes to analyst estimates for HD should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. HD is currently a Zacks Rank #3 (Hold).
Looking at its valuation, HD is holding a Forward P/E ratio of 22.38. This valuation marks a premium compared to its industry's average Forward P/E of 14.26.
We can also see that HD currently has a PEG ratio of 2.25. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Building Products - Retail was holding an average PEG ratio of 1.42 at yesterday's closing price.
The Building Products - Retail industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 156, which puts it in the bottom 40% of all 250+ industries.
The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
To follow HD in the coming trading sessions, be sure to utilize Zacks.com.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
The Home Depot, Inc. (HD) : Free Stock Analysis Report
To read this article on Zacks.com click here.