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Nothing But Praise for Home Depot (HD) at UBS

August 19, 2015 8:11 AM EDT
Get Alerts HD Hot Sheet
Price: $383.60 -0.59%

Rating Summary:
    24 Buy, 21 Hold, 4 Sell

Rating Trend: = Flat

Today's Overall Ratings:
    Up: 13 | Down: 11 | New: 11
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UBS analyst Michael Lasser reiterated a Buy rating and boosted his price target in Home Depot (NYSE: HD) to $138.00 (from $129.00) following another "stand out quarter." Lasser calls HD a "scarce company", and said the company is "building a dynasty."

"We think this was the type of quarter that HD needed in order to push the story to the next level," Lasse said. "It showcased why it stands in a limited group of large cap retail stocks where fundamental trends remain robust, capital allocation is slick, and the outlook continues to be favorable."

He added, "There just aren't many retailers who are putting up 5.7% absolute comp growth in the US, driven in part by a 2.5% gain in traffic. These results look even better on a multi-year stacked basis with a 2Q comp that has averaged nearly 7% over the last 3 years."

Looking ahead, the analyst said the biggest area of uncertainty is the degree to which rising interest rates pressure home improvement demand or the valuations of these retailers. However, the analyst believes performance will remain strong and it can grow through these risks.

The firm raised FY 2016 EPS from $5.28 to $5.30, FY 2017 EPS from $6.01 to $6.05 and FY 2018 EPS remained at $6.85.

For an analyst ratings summary and ratings history on Home Depot click here. For more ratings news on Home Depot click here.

Shares of Home Depot closed at $122.80 yesterday.



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