Home Depot sluggish after downgrade
Goldman Sachs lowers its rating for the home improvement chain, citing tough macro and housing data.
By Andrea Tse, TheStreet
Updated: 8 p.m. ET.
Shares of Home Depot (HD) were largely left out of Tuesday's rally after the stock was downgraded by Goldman Sachs (GS).
Goldman Sachs lowered its rating for Home Depot to "neutral" from "buy" on less compelling valuation and upside.
Home Depot shares dipped this morning but finished up 0.2% to $31.47 to $31.74, the second-worst performer among the 30 stocks in the Dow
Jones Industrial Average ($INDU). The Dow finished the day up 193 points, or 1.8% to 10,945, its best close since May 3.
"The company is executing well, but as the stock has bounced off the bottom in the midst of choppy macro data and soft channel checks and into tougher sales and margin compares over the next two quarters, valuation and upside are less compelling," Goldman Sachs analyst Matthew Fassler explained in an investor note.
"The exceptional HD turnaround story is still very much under way but is well understood by the market today."
Fassler said he's becoming increasingly selective on the do-it-yourself sector in the face of "tough" macro data and "uninspiring" channel check. He added that housing data remain weak.
"While we have noted a diminished correlation between sector sales and housing turns, leading indicators are subdued."
Goldman Sachs currently has a $35, 12-month price target for Home Depot stock. Home Depot is up 9.7% on the year, sixth-best among the Dow stocks.
Related Articles
RELATED ARTICLES
DATA PROVIDERS
Copyright © 2013 Microsoft. All rights reserved.
Quotes are real-time for NASDAQ, NYSE and AMEX. See delay times for other exchanges.
Fundamental company data and historical chart data provided by Thomson Reuters (click for restrictions). Real-time quotes provided by BATS Exchange. Real-time index quotes and delayed quotes supplied by Interactive Data Real-Time Services. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by SIX Financial Information.
Japanese stock price data provided by Nomura Research Institute Ltd.; quotes delayed 20 minutes. Canadian fund data provided by CANNEX Financial Exchanges Ltd.
RECENT QUOTES
WATCHLIST
MARKET UPDATE
| NAME | LAST | CHANGE | % CHANGE | |
|---|---|---|---|---|
| There’s a problem getting this information right now. Please try again later. | ||||
[BRIEFING.COM] Stocks entered the weekend on a mixed note as the S&P 500 shed 0.1% while the Dow ended with a gain of 0.1%.
The major averages began the day on a lower note as nine of ten sectors saw losses of more than 0.5%.
The consumer staples sector was the lone exception as the group spent the entire day in positive territory thanks to the relative strength of Dow component Procter & Gamble (PG 81.89, +3.19). The second-largest staple stock advanced ... More
More Market News
Currencies
| NAME | LAST | CHANGE | % CHANGE |
|---|---|---|---|
| There’s a problem getting this information right now. Please try again later. | |||
LATEST MARKET DISPATCHES
- No more Dispatches; here's where to find market news
The Market Dispatches column has been discontinued. Here's where to find the latest stock and business news on MSN Money, and the latest from market writer Charley Blaine.
- Dow falls 59 as late-day gloom kills a rally
- Stocks held back by fiscal-cliff worries
- Stocks suffer worst weekly loss in 5 months
- Dow off 121 as post-election swoon continues
- Dow slumps 313 after Obama's re-election
- Dow jumps 133 as Americans head to the polls
TOP STOCKS
Try as the bears might, they couldn't break U.S. stocks. But investors still face frothy prices and considerable headwinds.
