The Home Depot, Inc. (HD) Stock Analysis - 2025-11-22
Comprehensive stock analysis for The Home Depot, Inc. (HD) including price targets, technicals, and outlook. Updated 2025-11-22.
Price Action Analysis
The daily chart shows a downward trend for The Home Depot, Inc. (HD) over the past three months. After a period of relative stability in late August and early September, the stock experienced a significant decline, with notable red candlesticks indicating selling pressure. Volume behavior appears somewhat erratic during this downtrend, with occasional spikes that don't always correspond to immediate price reversals. Key resistance can be observed around the $420-$430 range, and support seems to be forming in the $340-$350 area. The recent price action shows a sharp drop on high volume, which could signal a capitulation or a significant bearish event.
The weekly chart, spanning two years, reveals a longer-term uptrend that has recently encountered significant headwinds. While the overall trajectory has been upward, the stock has pulled back considerably from its highs. The volume on the weekly chart shows a more consistent pattern, but the recent spike in daily volume is particularly noteworthy when viewed against this longer-term context.
News & Catalysts
I'm sorry, I cannot provide news or analyst updates.
Fondamental analysis
Here's a summary of The Home Depot, Inc.'s fundamental data:
| Metric | Value |
|---|---|
| Market Cap | $321.01B |
| P/E Ratio | 19.31 |
| Forward P/E | 17.09 |
| PEG Ratio | 1.90 |
| EPS (TTM) | $17.91 |
| EPS Growth (TTM) | -10.30% |
| Revenue (TTM) | $159.38B |
| Revenue Growth (YOY) | -2.00% |
| Gross Margin (TTM) | 30.42% |
| Net Income (TTM) | $16.17B |
| ROE | 52.40% |
| Debt to Equity | 109.17% |
| Analyst Recommendation | Hold |
| Avg. 1-Year Price Target | $379.05 |
Key Takeaways:
- Valuation: The P/E ratio of 19.31 and a forward P/E of 17.09 suggest that the stock is reasonably valued, especially considering its historical performance. The PEG ratio of 1.90 indicates a moderate growth expectation relative to its P/E.
- Profitability: HD demonstrates strong profitability with a high ROE of 52.40%. However, recent EPS growth has been negative (-10.30% TTM), and revenue growth has also seen a slight decline (-2.00% YOY).
- Guidance/Estimates: Analyst estimates suggest an expectation of earnings growth (lower forward P/E), but the current negative trend in EPS growth warrants attention.
- Ownership: The analyst recommendation is generally a "Hold," with an average price target that is slightly above the current trading price, implying limited near-term upside according to analysts.
Market & Sentiment Context
The broader market has been volatile, with concerns about inflation, interest rates, and potential economic slowdown impacting consumer spending, particularly on discretionary items like home improvement goods. Home Depot, as a large retailer, is sensitive to these macroeconomic factors. The recent spike in volume suggests that investors are reacting significantly to something, either company-specific news or a broader market shift. The high volume accompanying the price drop could indicate distribution, where large holders are exiting their positions.
Investment Outlook
The current price action, characterized by a significant decline on high volume, suggests increased selling pressure and potential investor concern. While the company has strong historical performance and profitability, the recent negative trends in EPS and revenue growth, coupled with macroeconomic headwinds, present challenges. The stock appears to be in a downtrend, and further downside is possible if key support levels are breached.
Key Buy/Sell Levels
The current price for HD is $343.32.
Support Levels:
- $340 - $350: This level has recently been tested and appears to be acting as immediate support. The sharp drop on high volume on the daily chart indicates significant activity in this zone.
- $320 - $330: This was a significant support area in the weekly chart's history. The current price is approximately $13.32 (3.88%) above this zone.
Resistance Levels:
- $360 - $370: This area represents a prior support level that may now act as resistance. The current price is approximately $16.68 (4.86%) below this zone.
- $380 - $390: This range previously acted as support and resistance. The current price is approximately $36.68 (10.68%) below this zone.
These levels correspond to:
- $350: This horizontal line represents a recent support zone that has been tested.
- $330: This horizontal line marks a more significant prior support level, which is approximately 3.88% below the current price.
- $370: This horizontal line indicates a prior support level that may now act as resistance, approximately 4.86% above the current price.
- $390: This horizontal line represents a higher resistance zone, approximately 10.68% above the current price.
Summary & Takeaways
The Home Depot, Inc. (HD) is currently experiencing a significant downturn, marked by a sharp price decline on unusually high trading volume. This price action, coupled with recent negative trends in revenue and earnings growth and broader macroeconomic concerns impacting consumer spending, suggests a bearish sentiment. While the company maintains strong long-term profitability metrics, the immediate outlook is clouded by these factors. Key support levels are identified around $340-$350 and $320-$330, while resistance is expected at $360-$370 and $380-$390. Investors should monitor these levels closely for potential shifts in momentum.