New home building is in a slump but remodeling, general maintenance and repair from the recent weather disasters has kept Home Depot (HD) in the black. Same store sales are up year over year and analysts predict a bright future. Over the past 2 1/4 years the price has been up and down but as the Barchart provided graph of the trading prices shows the stock has held up well during this latest recession:
Barchart technical indicators:
- 80% Barchart short term technical buy signal
- Trend Spotter buy signal
- Trading above its 20, 50 and 100 day moving averages
- 6 new highs in the last 20 trading sessions and up 8.91% for that period
- Relative Strength Index is 58.79% and rising
- Barchart computes a technical support level at 34.00
- Traded recently at 34.71 with a 50 day moving average of 32.71
In the home building supplies sector size seems to matter and Home Depot (HD) has the most stores to attract buyers and being the largest has the greater advantage to negotiate favorable contract for goods. Although this is not a full blown growth stock it should do well over the next few years. Buyers at this price will probably see a total annual return in the 10% - 12% range over the next 5 years.
Jim Van Meerten is a Marketocracy Master
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