Home Depot Stock Jumps Ahead of Earnings on Raised Price Targets

Home Depot's stock price has surged overnight ahead of its second-quarter earnings report. Stifel, a financial firm, raised Home Depot's price target to $340 while maintaining a 'Hold' rating.

The upgrade comes with a warning: the company's premium valuation may be too high, and a meaningful housing and home-improvement recovery is needed to support further upside. Stifel believes that Home Depot trades at a premium to its rival Lowe's Companies Inc., reflecting stronger operating positioning and opportunities tied to professional customers.

RBC Capital also raised its price target on Home Depot to $343, citing the company's investments in its distribution network and store footprint as advantages. However, RBC cautioned that investors may already be pricing in a quick rebound in housing activity, leaving less room for disappointment if the recovery develops more slowly than expected.

Analysts expect Home Depot to post $47.23 billion in Q2 revenue with earnings of $4.73 per share.