Home Depot is scheduled to report earnings before Tuesday’s open. The stock hit a record high of $420.61/share in 2021 and is currently trading near $290/share. The stock is prone to big moves after reporting earnings and can easily gap up if the numbers are strong. Conversely, if the numbers disappoint, the stock can easily gap down. To help you prepare, here is what the Street is expecting:
Earnings Preview
The company is expected to report a gain of $3.81/share on $38.60 billion in revenue. Meanwhile, the so-called Whisper number is a gain of $3.85/share. The Whisper number is the Street’s unofficial view on earnings.
Charts & Data Courtesy MarketSmith Inc.
Charts & Data Courtesy MarketSmith Inc.
A Closer Look At The Fundamentals
Home Depot sports an attractive price to earnings (P/E) ratio of 17. The company’s earnings have grown nicely over the last several years and are expected to grow by 6% in 2025 compared to 2024.
A Closer Look At The Technicals
Technically, the stock topped out in 2021 just above $420/share. The stock bottomed in September 2022 near $265/share. That was a steep bear market because the stock fell around 37% during that time. Since then, the stock has rallied about 10% and is currently trading near $290/share. The bulls want to see the stock rally after earnings are announced and the bears want to see it fall.
Pay Attention To How The Stock Reacts To The News
From where I sit, the most important trait I look for during earnings season is how the market and a specific company reacts to the news. Remember, always keep your losses small and never argue with the tape.
Disclaimer: The stock has been featured in my FindLeadingStocks.com report.
