The Home Depot Is An Iconic American Company, But It’s Overvalued (Rating Downgrade)

Summary:

• Home Depot’s stock has recently underperformed the S&P 500. Its slower growth offers stability but lacks upside, with a 5-year EV CAGR forecast of -0.22%.
• The Buffett Indicator (208% of GDP) signals market-wide overvaluation. HD’s intrinsic EV is ~40% below its current level, showing a -62% margin of safety.
• Strong management ethos and investments in the Pro Ecosystem (45% of sales) ensure long-term stability. However, current valuations suggest Sell for prudent investors.

Since my last analysis of The Home Depot, Inc. (NYSE:HD), the stock has gained 14.4% in price, compared to a 24.35% growth in the S&P 500 (SP500), revealing the moderate return prospects investors should

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