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The Home Depot Inc., Corrective Trading Dynamics

1/10/2023 2:23 PM

The stocks of the largest home improvement company, The Home Depot Inc., continue to be in a corrective trend and are held at 318.00.

At the beginning of the year, analysts traditionally tend to revise their forecasts regarding the corporate segment. Thus, experts of the investment bank Cowen Group Inc. spoke about the issuer's shares, according to which the market has not yet fully appreciated the improvements in the HD Pro supply chain, and further development of this direction can provide significant support to the stocks. Against this background, analysts adjusted the target price for the shares to 379.0 dollars, which is significantly higher than the current 320.0 dollars.

As for the financial condition of the company, the final report will be published on February 21. Thus, revenue is expected to reach 36.03B dollars, which is inferior to 38.9B dollars a quarter earlier. The estimated earnings per share is 3.29 dollars, which is lower than 4.24 dollars a quarter earlier, and at the end of the year the indicator is projected in the range of 16.15-16.46 dollars per share. A decision on dividends has not yet been made, however, according to preliminary estimates, The Home Depot Inc. is ready to keep payments at 1.9 dollars per share, which corresponds to 2.40% per annum.  

On the daily chart, the asset continues to correct within the global sideways trend and is currently rising in the local upward corridor.

Technical indicators remain in uncertainty and are ready to issue a new buy signal: the fast EMAs on the alligator indicator are close to the signal line, and the histogram of the AO oscillator is close to the transition level and ready to overcome it. 

Support levels: 310.00, 292.00. | Resistance levels: 328.00, 346.00.

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