Pre-Market Activity Shows Gains 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.

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 $553.2 million.
  • HD traded 290,621 shares today in the pre-market hours as of 8:48 AM.
  • HD is up 2.1% 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 2.1%. HD has a PE ratio of 24. Currently there are 10 analysts that rate Home Depot a buy, no analysts rate it a sell, and 9 rate it a hold.

The average volume for Home Depot has been 4.9 million shares per day over the past 30 days. Home Depot has a market cap of $145.3 billion and is part of the services sector and retail industry. The stock has a beta of 1.19 and a short float of 0.9% with 1.69 days to cover. Shares are up 6.6% 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 solid stock price performance, impressive record of earnings per share growth, compelling growth in net income, revenue growth and notable return on equity. We feel its 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:
  • Powered by its strong earnings growth of 43.83% and other important driving factors, this stock has surged by 46.69% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, although almost any stock can fall in a broad market decline, HD should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • HOME DEPOT INC has improved earnings per share by 43.8% 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 $4.72 versus $3.75 in the prior year. This year, the market expects an improvement in earnings ($5.22 versus $4.72).
  • 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 36.1% when compared to the same quarter one year prior, rising from $1,013.00 million to $1,379.00 million.
  • Despite its growing revenue, the company underperformed as compared with the industry average of 12.1%. Since the same quarter one year prior, revenues slightly increased by 8.3%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • 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.

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