UBS Reiterates Buy Rating on Home Depot (HD)

UBS analyst Michael Lasser reiterated a Buy rating and $475.00 price target on Home Depot (NYSE: HD).

The analyst commented, "Overall, our takeaway from HD's second quarter print is that it provides evidence to support the view that Home Depot should see outsized gains as a recovery takes shape. As we see it, the key factors within Home Depot's control that will influence the shape of its P&L inflection include: 1) The degree to which it can gain market share; and 2) The degree to which it can enhance its profitability as its sales improve. In both cases, we think the reads were supportive. In 2Q, HD's US comp outperformed the Census Bureau retail sales category by 251bps versus 38bps last quarter. Similarly, the company generated an est. 50bps of underlying gross margin expansion driven in part by improvements from shrink management and supply chain efficiencies. These factors put the company in a good spot for an eventual recovery even as the timing and magnitude of this potential upturn remain uncertain."

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 $407.20 yesterday.

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