Home Depot Inc Earnings Model (Jumma)
Author: Faiz Jumma, Published: February 23, 2020 2:09pm, Category: Earnings Preview (Prior to Fiscal 4Q2019 earnings)
Summary of Model: This model represents Home Depot as slightly bullish. The reason for this is run by a couple of major value drivers. One of these includes the 2019 holiday shopping season, which represents the sales from Black Friday as well as Cyber Monday. Home Depot has also introduced new initiatives to modernize technology, such as BOPIS, which aims to reduce wait times and improve customer relations for customers. Another major driver is the lumber and copper market, as there was deflation in the market at the end of 2019. Moving forward, the lumber and copper market would bounce back, causing prices to increase, which would directly relate to higher comp. store sales for the Q4 of 2019. In the end, for the 2019Q4 for Home Depot, comparable store sales, gross margin, and Selling, General, and Administration rates will rise slightly, resulting in slow growth, leaving Home Depot as slightly bullish.
Disclosure of Potential Conflicts of Interest: The author of this article/model has no financial investment or other conflict of interest related to the subject company or other companies discussed. Any views made or implied in the content represent the author’s opinions.