Home Depot Inc. (NYSE: HD) has confirmed the release date for its Q4 2022 earnings report, which is on Tuesday, February 22, 2022, before the market opens.
What to look for: The company has done well in meeting the growing demand for home improvement. During the pandemic, people spent the most time at home, taking on making time at home more productive and enjoyable. There have been concerns that there will be a sharp drop in Home Depot sales with the reopening of the economy. Therefore when the company releases its Q4 2022 results, investors will be keen on consumer trends and management's outlook for 2022.
Earnings: Stockearning’s Estimated EPS is expected to be around $3.2 per share, representing a YoY change of 16.8%. In the last quarter, the company produced an earnings surprise of 14.96% with an EPS of $3.92. Historical EPS Performance for the past 12 quarters indicate that the company has beat estimates 34 times (94%), met once (2%) and missed once (2%).
Revenue: In the fourth quarter, the company anticipates sales of $34.61 billion, suggesting a 7.3% increase. For the quarter ended October, the company reported a sales growth of 9.8%. Several macroeconomics factors favour HD, , including high prevalence for work from home, increasing home prices, and limited home inventories for sale.
Stock movement: Home Depot shares have lost 5.3% since the company released its third-quarter earnings. Interestingly, the company's shares have been UP 24 times out of the past 48 quarters. So, the historical price reaction suggests a 50% probability of the share price going UP following the fiscal Q4 2022 earnings release. According to the Stockearning algorithm, the predicted first-day move is +/-2%, while the predicted move on the seventh day is +/-3%.
What analysts are saying: JPMorgan analyst Christopher Horvers slashed his price target on the stock from $413 to $406 but maintained a buy rating on the stock. In a research note, the analyts told investorse that the consumer environment is supportive but seems to be slower than 2021 and 2020. He feels that the recent rate moves may increase the risk for an additional giveback in the company's share.
Truist analyst Scot Ciccarelli commenced coverage, upgraded the stock from Hold to Buy,, and raised his price target from $420 to $448. According to the analyst, key industry dynamics are demand/supply imbalances, pandemic-driven consumer changes, the housing market, and ageing housing infrastructure, which are all driving significant additional home renovation growth. In addition Ciccarelli said that the company will continue to gain market share as a result of its size/scale advantages and improved supply chain capabilities.
Wells Fargo analyst Zachary Fadem raised his price target on the HD from $420 to $460 and maintained a Buy rating on the shares. The analyst feels Home Improvement firms are better placed to endure inflation due to recurrent, less-discretionary acquisitions, share gains, opaque pricing, and scale benefits.
DA Davidson’s Michael Baker increased his price target on HD from £395 to $420 and maintained a Hold rating on the stock as part of a wider research note to investors in Broadlines/Retailing and Hardlines Category. While the analyst claims that he is not making any "significant" adjustments to his estimates, the modifications in his price objective represent a forward wrap in valuation models to estimated earnings in 2023.
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