Home Depot Negative Outlook
"the last one is Home Depot, which I actually shorted Home Depot back in 2022. I'm not a big fan of the company in general, especially as everything is transitioning online for the next 5 to 10 years. I think it's going to be disrupted ultimately and fast delivery. But Home Depot is down 11% over the last year. It has really pretty much done nothing over the last 5 years. Has barely up 29%. So, it has not been, you could say, doing its best. Now looking at the average revenue growth over the last few years and given the current valuation at 26 times forward earnings, I believe Home Depot is the least attractive of them."
The speaker expresses a bearish view on Home Depot, noting that its performance has been lackluster relative to other stocks. He points out that the company, which he previously shorted, is facing disruption from the online transition and weak market growth prospects. Additionally, he criticizes its high valuation multiples in the context of modest growth expectations.
Home Depot Earnings Disappointment and Guidance Cut
"Let's go to Home Depot because they came out with results today. Yeah. Stock stumbled 6% today. That was the worst day since February 2023. The ticker is HD. They cut their fourear earnings guidance and they're warning that steady consumers are hitting the pause button on big ticket home purchases. Of course, the housing market has been somewhat frozen. So, that has been weighing on the company. Add to that tariffs, a lot of the materials are more expensive, a lot of confusion, supply chain issues. So, that has been weighing on the stock that's already down 11% year to date. The retailer said it expects adjusted earnings per share to 5% from year ago. The company said its profit and comparable sales uh sales came in lower than expecting in last quarter. So, a lot of pressure for a company that uh has been under macro and other uncertainty already and another earnings report that didn't alleviate concerns."
Home Depot (HD) experienced a sharp 6% drop, marking its worst day since February 2023, as the company cut earnings guidance amid a slowdown in big-ticket home purchases. Challenges such as higher material costs, tariffs, and supply chain issues are compounding investor concerns, reflecting a bearish sentiment on its near-term outlook.
Home Depot Faces Consumer and Housing Market Headwinds
"Also looking at Home Depot. We do see shares of Home Depot lower down by about 3.6%. That's ticker HD. but it was earlier down as much as 5%. That's the most and the lowest level since um April here. This is after the company cut its fullear earnings guidance. We really are seeing of course some data that does support the fact that the labor market is doing okay, but it does seem as though uh in this particular space when we think about home improvement. The consumer is pressured here. We're not seeing as many people buying those big ticket items that they were before at Home Depot. Tariff concerns still of course in focus and just generally uh we're seeing a housing market that still remains frozen."
The commentary on Home Depot (HD) indicates notable share declines following a cut in full-year earnings guidance. Despite some strength in the labor market data, consumer pressure and a stagnant housing market are weighing on demand for big-ticket home improvement items, contributing to bearish sentiment.
Home Depot Guidance Cut Reflects Consumer Caution
"Ticker HD because their shares have been down nearly 3%. So the main thing, they cut their full year earnings guidance. Consumers are just they're just not doing those big ticket home purchases. Instead, they're doing the small projects like they're painting their, sprucing up their garden, you know, those little things that can make a whole world of a difference."
The speaker highlights issues at Home Depot (HD), noting the shares are down and full year earnings guidance has been cut due to a shift in consumer behavior from large home purchases to smaller projects, signaling caution in the near-term consumer environment.
Home Depot Faces Consumer Headwinds Amid Guidance Cut
"Okay, ticker HD because their shares have been down nearly 3%. So, the main thing they cut their fleear earnings guidance. Consumers are just they're just not doing those big ticket home purchases. What they're doing instead projects like their painting, they're sprucing up their garden, but they expect their adjusted earnings per share to decline 5% from a year ago. So, that was lower than it's forecast. But, it's just this kind of warning about the strength of the consumer because we haven't had the eco data, right? It's been on pause."
The transcript highlights Home Depot (HD) cutting its earnings guidance amid a consumer shift from big-ticket home purchases to smaller improvement projects. The share decline of nearly 3% underscores concerns over weakening consumer strength as economic data remains elusive.
Buy Call on HD
"About two weeks ago, we broke down why we believe that HD at $13.95 was a buy. And it was because, quite frankly, its future merger partner, Terrestrial Energy, is a nuclear energy play on a short list for Department of Energy partners. And if you look at its recent trading, it hit $20.55 at highs on Friday, which is great. But what is the continued case to buy HD stock before they essentially merge and take Terrestrial Energy public? The case that I would make is for starters, theyre fast-to-market nuclear with a modular, capital-light design and rapid regulatory progress."
The speaker issues a buy call on HD, citing its attractive entry price of $13.95 and anticipating a merger with Terrestrial Energy. He highlights the nuclear play element, fast-to-market capabilities, and recent price action reaching $20.55 as supporting evidence for a compelling near-term upside.