2016-08-24 15:10:30

The Home Depot Inc., #HD [NYSE]
Services, Retail, USA

Financial performance:

Index –DJIA, S&P 500; Beta – 0.91;
Capitalization - 165.39 В; Assets profitability - 16.20%;
Revenue - 6.34 B; Average volume – 6.14 М;
P/E -23.85; ATR – 2.62.

Analytical review:

  • The Company has the 4th biggest capitalization in the service sector among the issuers listed on the US stock market.
  • Last month, the issuer formed key support and resistance levels at 135.70 USD and 138.45 USD. The price retained the support level last week. The Home Depot's quotes may continue growing on the company's positive corporate report and upbeat data from the US stock market.
  • According to the latest report on the second quarter of the fiscal year 2016, the company's revenue edged up 6% to 26.472 billion USD, which exceeds analysts' expectations of 26.437 billion USD. EPS (earning per share) grew 13.9% to 1.97 USD;
  • The Home Depot has been long viewed as the US largest retailer in the construction products and tools sector, with its market share amounting to over 27%. The Census Bureau reported yesterday that US' new home sales had reached 12.4% in July. The publication will result in the company's bigger sales in the nearest future.
  • On 17th August last week, the Wedbush and RBC Capital investment companies upgraded The Home Depot's ranking and updated the target stock cost to 145-155 USD.

Summary:

  • The company's recent report proves that the company's management has been working efficiently. Despite the strong dollar's pressure, the retailer's revenue and net profit grew, exceeding market expectations. Housing market growth will contribute to bigger sales in the nearest future.
  • Thus, we expect that the company's quotes will be rising in the nearest future.

Trading tips for The Home Depot Inc.'s CFDs

Key levels:
Support levels: 135.70 USD, 133.25 USD
Resistance levels: 138.45 USD

Medium-term trading, H1
The issuer is currently trading near a support level of 135.70 USD. Once this level steadies and relevant confirming signals appear (Price Action patterns, for example), we recommend searching for market entry points to open long positions. Risk per trade: no more than 2% of equity. Stop order shall be placed a bit below the signal line. We recommend that prospective profits should be fixed partly at the levels of 138.40 USD, 140.50 USD and 143.00 USD, with Trailing Stop applied.

Medium-term trading, H1
Medium-term trading, H1


Short-term trading, M15
The issuer is currently trading between the local support and resistance levels of 136.05/136.45 USD. We advise you to search for market entry points once these levels are broken and tested. Positions shall be opened in the direction of the signal line and the nearest support/resistance level. Risk per trade: no more than 3% of equity. Stop order shall be placed a bit above/below the signal line. Prospective profits shall be fixed partly, at 50%, 30%, and 20% of a prospective fluctuation, with Trailing Stop applied.

Short-term trading, M15
Short-term trading, M15