Strong Upward Pre-Market Activity For Home Depot (HD)

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified Home Depot ( HD) as a pre-market leader candidate. In addition to specific proprietary factors, Trade-Ideas identified Home Depot as such a stock due to the following factors:

  • HD has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $554.9 million.
  • HD traded 21,590 shares today in the pre-market hours as of 7:38 AM.
  • HD is up 2.7% today from Friday's close.

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More details on HD:

The Home Depot, Inc. operates as a home improvement retailer. The stock currently has a dividend yield of 2%. HD has a PE ratio of 20.9. Currently there are 11 analysts that rate Home Depot a buy, no analysts rate it a sell, and 8 rate it a hold.

The average volume for Home Depot has been 6.4 million shares per day over the past 30 days. Home Depot has a market cap of $109.1 billion and is part of the services sector and retail industry. The stock has a beta of 0.85 and a short float of 0.9% with 1.75 days to cover. Shares are down 5.6% year-to-date as of the close of trading on Friday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Home Depot as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, notable return on equity, impressive record of earnings per share growth, compelling growth in net income and good cash flow from operations. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated.

Highlights from the ratings report include:
  • HD's revenue growth has slightly outpaced the industry average of 6.8%. Since the same quarter one year prior, revenues slightly increased by 7.4%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • HOME DEPOT INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, HOME DEPOT INC increased its bottom line by earning $3.00 versus $2.46 in the prior year. This year, the market expects an improvement in earnings ($3.74 versus $3.00).
  • The company, on the basis of net income growth from the same quarter one year ago, has significantly outperformed against the S&P 500 and exceeded that of the Specialty Retail industry average. The net income increased by 42.7% when compared to the same quarter one year prior, rising from $947.00 million to $1,351.00 million.
  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Specialty Retail industry and the overall market, HOME DEPOT INC's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • Net operating cash flow has increased to $1,263.00 million or 12.46% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -5.07%.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.
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