HD Stock Sees Strong Analyst Support Amid Q2 Earnings Beat

Home Depot's stock has seen significant analyst support lately, particularly after its Q2 earnings report. The company's revenue grew by 5.7% to $47.9 billion, surpassing market expectations and driven mainly by solid comps growth and higher ticket averages.

The analysts' consensus price target of $373.89 indicates a moderate buy rating among analysts. This target is based on the robust accumulation pace seen in institutional holdings over the past 12 months, which has aligned with the technical buy signal. MarketBeat data reveals that these institutions have been buying at an impressive rate of 4.5-to-1.

Home Depot's Q2 report highlighted several strengths, including operational performance, unexpected consumer strength, and the impact of tariff refunds, which largely offset rising costs. The company reaffirmed its guidance for about 3.5% revenue growth and 15 new stores. Analysts from Wells Fargo, Royal Bank of Canada, and Jefferies cited margin outperformance, comp-store strength, and surprising small project growth in their commentaries.

However, the analysts also expressed caution regarding margin compression due to rising costs. The company's dividend payment is currently at 65% of its earnings and has been increased for over 15 consecutive years, with a high-single-digit compound annual growth rate.