You heard it here first. Home Depot is going to report 3rd quarter earnings tomorrow, and possibly do a projection on future business (it's so bad they stopped reporting same store sales results).
Unless they're juicing the books so the CEO can sell more shares, tomorrow is the beginning of the end for Home Depot - the Cisco Systems of the housing bubble.
A wicked burst of the housing bubble, a 40% decline in home starts, and a panicked public, means those Home Depot parking lots are a LOT less busy than a year ago. Not good news for their 234,000 employees - about 100,000 too many I'd guess.
Note I am short HD via a Jan '07 put option.
Earnings Preview: Home Depot - Home Depot Faces a Sagging Housing Market and Tough Comparisons in the 3rd Quarter
NEW YORK (AP) -- Home Depot Inc., the largest U.S. home improvement store chain, reports earnings for the third-quarter on Tuesday. The following is a summary of key developments and analyst opinion related to the period.
OVERVIEW: As the housing market cools off, home-improvement companies are suffering as well. Falling lumber prices have cut into revenue, and several suppliers have reported lower results and outlooks recently, including Home Depot's largest supplier, Masco Corp.
Home Depot is also reviewing Nardelli's compensation in light of a sagging stock price.
ANALYST TAKE: Credit Suisse analyst Gary Balter, who rates shares of Home Depot "Neutral," forecast earnings of 74 cents per share and expects investors to pay as much attention to whether Home Depot meets expectations as how it get there and where it's going.
"Meeting expectations on cost cuts and share repurchases will not satisfy investors, in our view," Balter wrote in a note on Monday.
He expects Home Depot to lower its 2007 earnings growth guidance of 10 percent, or $3. "Should they move closer to our level of $2.90 vs. consensus of $2.95, that could pressure shares," Balter wrote. "More important are comments on how protracted the slowdown will be."
November 13, 2006
Like lambs to the slaughter: Home Depot is going to get murdered tomorrow
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19 comments:
Is that OJ's glove outside the Home Depot?
Good I'm glad- Almost everything they sell is a rip off.
From my local HD's (two in driving distance) they are about as crowded as they ever were. The contractors probably come in at 6 AM so I do not know how that part in going.
Good I'm glad- Almost everything they sell is a rip off.
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And way over priced! I have a pellet stove..last year Homedepot
(even in a warm up period) could not keep the things in the store...now there is a friggin wall about 10 pallets high from one end of the store to the other.
Dont look to busy to me.
I was in the Lowes by me yesterday morning and it was dead (a year ago same store was very busy) and guess what's going up across the street from it ? A brand new Home Depot !! fight over the crumbs suckers !!
All the anonymous out there start stating your town. Its hard to get an idea of this bubble if no one every states where they are. I just got back from Lowes in Norfolk Va and for 2pm it seemed quite busy. Yes, I agree that something at the big boxes are over priced. You really must know what things are selling for.
Hey, there's still that 401k money that we have left! Let's go shopping!
Natural Food Chain, get it chain.
Survival of the fittest.
And now for something completely different. . .I just went past Pelican Yacht Sales here on Harbor Island in San Diego, and noted that out of 50 Yachts for sale, 14 were at REDUCED PRICE!! or Best Offer!. . .these are not the Donald Trump yachts, but the 50K to 300K boats for the Hummer Class. . .guess those ARMS and HELOCS are taking their toll. . .I may pick up a nice little runabout soon on all the money I am saving by renting. . .also there were some "lien sales" next door at the Mooring Company - failure to pay mooring fees!. . .hmmmm. . .will keep tabs on this new develpent.
I expect 300 stores to closed 2008 and 500 by 2010.
Quite busy? So what. In my town, 2 HD's are dead, 1 Lowes "busy" and another Lowes dead. Get that picture? Demand for their product will continue, but at a much lower rate.
what's yer strike price on that put?
my car lease expires in a few weeks so I'm nlooking around and yesterday I came across this site offering take-over leases (I forget the name) and oh my gosh there are so many high-end cars up there with people offering $2-3-4,000 to take over their leases on ridiculous things like Escalades and Hummers (along with a ton of BMWs and MBZs).
not sure what that says, other than too many people got in way over their heads with a lot more car than they can afford, just like with their McMansions.
http://www.2hulls.com/salecat40.html
Notice how many 'reduced' yachts are from Florida....
This is all part of Wall Street's war on the middle class. Make the public lust after the trappings of the rich and famous and get themselves so far in debt that they can never retire. Then, ship their jobs over to China so that they are too scared to ask for a raise.
Next, devalue the dollar and destroy what meager savings they have.
After that, they'll gladly vote for any dictator promising them bread and circuses. It will just cost them their rights and freedom.
I'd take your short off the table. Its too soon. With market manipulation, it can stay strong thru May '07 at least. Same with the homebuilders and the banks/lending agencies.
BRAVO TO THE FOLLOWING POST...
FINALLY SOMEBODY HAS SAID IT ALL...
WALL STREET...
WALL STREET IS THE TAIL WAGGING EVERYBODY RIGHT NOW.
Right now, our biggest problem is publicly traded companies ...
The corporate...share oriented structure is the huge problem. CEO's and everybody from top to bottom care about the short term and not long term... i.e. the horrible news about KB Chair...
I hope if he is truly guilty rots...
Anonymous said...
This is all part of Wall Street's war on the middle class. Make the public lust after the trappings of the rich and famous and get themselves so far in debt that they can never retire. Then, ship their jobs over to China so that they are too scared to ask for a raise.
Next, devalue the dollar and destroy what meager savings they have.
After that, they'll gladly vote for any dictator promising them bread and circuses. It will just cost them their rights and freedom.
Home Depot Net Income Falls First Time in Three Years
watch the chart since they startet their 13 billion $ buyback programm......
http://immobilienblasen.blogspot.com/2006/11/home-depot-net-income-falls-first-time.html
Does the bloody glove fit?
HD stock is up 2% today. How are those Jan 2007 puts doing?
Suggestion: Stick to what you know; i.e., not investing.
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