Good news hit for home improvement giant Home Depot (HD), but investors did not seem happy to hear about it. Out in California’s Santa Clara County, over $1 million in stolen merchandise was recovered, as an “organized theft outfit” that dealt in stolen goods was found and broken up. But investors still turned on Home Depot regardless, sending shares sliding fractionally in Monday morning’s trading.
Elevate Your Investing Strategy:
- Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence.
The Santa Clara Sheriff’s Office, and the District Attorney’s Office, reportedly found “…houses in the area filled to the brim with pilfered items including power tools and various housewares.” The stolen goods were reportedly resold online, and were found not only in houses, but in storage units and even an entire warehouse, reports noted.
Worse, the stolen goods scheme also ran a separate scam which targeted the elderly. The scam coerced its victims into going to impacted retailers like Home Depot and purchasing gift cards, which were then transferred to the group and used to obtain more items for resale. Reports suggested that the group managed to pull in nearly $10,000 daily in merchandise, which was then added to the stockpiles found.
Home Improvement “Winter”
For anyone who has tried to carry out a home improvement project, most know that winter is not the best time in which to do it. Usually these projects are done ahead of winter, so their results can be enjoyed in a time when the people who do them are home most often, or ahead of holiday entertaining. But winter is also coming for home improvement, based on some new reports.
With a growth outlook running between 3% and 4%, and the second quarter results only managing to show modest growth, there is very little to encourage investors these days. Throw in the fact that the market has fundamentally shifted from big-box dominance to online dominance, and Home Depot’s odds of recovery do not look great going forward.
Is Home Depot a Good Long-Term Buy?
Turning to Wall Street, analysts have a Strong Buy consensus rating on HD stock based on 19 Buys and six Holds assigned in the past three months, as indicated by the graphic below. After a 4.02% loss in its share price over the past year, the average HD price target of $446.30 per share implies 15.51% upside potential.
