Oppenheimer analysts said the firm sees a buying opportunity in Outperform-rated Home Depot (NYSE:HD), although they lowered the price target on the stock to $360 from $400 per share.
Analysts told investors in a note that as they consider the recent, weaker-than-planned results at HD, they find a number of notable intermediate, longer-term positives for the company and its shares.
Home Depot shares fell more than 2% following its latest earnings release, although it has since regained those losses and more, currently trading at just below $296 per share.
These include "prospects for top-line trends to re-solidify, as weather and lumber price dislocations abate; now even more subdued FY23 (Jan.2024) guidance and Street forecasts; and a still-historically discounted equity valuation."
"Our continued constructive call on HD and home improvement retail remains hinged to the view that any fundamental weakness nearer term should prove short-lived, and give way to a return to historical healthy sales, and profit expansion algorithms, supported by ongoing structural underpinnings, within leading operators and the space, broadly," analysts concluded.