Home Depot Inc Earnings Model (Subramanian)
Author: Anik Subramanian, Published: February 2, 2020 7:32pm, Category: Earnings Preview (Prior to the Fiscal 4Q2019 earnings release)
Summary of Model: HD’s key drivers of this model include Black Friday sales, the release of new products, online store sales, and a change in lumber and copper prices. HD’s increased online store sales, the recent inflation of lumber and copper prices in response to Q3’s deflation, and a projected increase in average ticket sales result in projected growth in Q4. Additionally, decreased tariffs are projected to limit the fall in gross margin. Key assumptions in this model include an expected improvement in the housing market in 2020 and a return on investment for HD’s new strategic initiatives and technology. Overall, a slightly bullish outlook is portrayed in the model, compared to analyst estimates.
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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.