What happened
Not for the first time this month, Home Depot (HD 0.94%) stock was the recipient of an analyst's price-target increase. That little flash of optimism ignited more interest in the retailer, and its share price closed more than 2% higher as a result. By contrast, the bellwether S&P 500 index slumped on the day, falling by nearly 0.5%.
So what
Well before market open, Chuck Grom of Gordon Haskett raised his fair value estimate of Home Depot stock to $315 per share, adding $15 to his previous level of $300. He maintained his accumulate (buy, in other words) recommendation on the stock.
This was only the latest in a series of recent price-target hikes by increasingly more bullish analysts on the storied retail industry mainstay. These followed an investor update issued by Home Depot in mid-June in which the company reaffirmed its existing guidance for the entirety of its fiscal 2023.
Although the company continues to expect declines in sales and comparable sales by 2% to 5% compared to the previous year, and per-share earnings to fall by 7% to 13%, it did say that the overall U.S. market should continue to rise.
It quoted CEO Ted Decker as saying that
We operate in a large and highly fragmented market with unique characteristics that make it one of the most attractive sectors in retail, if not the economy as a whole. While we are the number one home improvement retailer in the world, we have a relatively small share of the market today, and there are significant opportunities in front of us.
Now what
A clutch of analysts took those remarks to heart, including Jefferies's Jonathan Matuszewski. In the wake of that update, he cranked his Home Depot price target higher, moving it to $349 per share from $337. Like his colleague Grom, he maintained the existing buy recommendation on the stock.
