Jim Cramer says be patient and stick with Home Depot
CNBC’s Jim Cramer told investors to hold on to stock of home improvement retailer Home Depot $Home Depot(HD.US$ , even though its most recent quarter lacked luster.
“Sure, the quarter wasn’t great, but the conference call commentary I found encouraging, which is why I’m willing to be patient and hold on to Home Depot,” he said. “Remember, you can’t wait for the actual turn, you have to get in ahead of time or you’ll miss the move.”
Home Depot on Tuesday said quarterly sales declined nearly 3% year over year, but it surpassed Wall Street’s earnings and revenue expectations despite the cooler demand.
Cramer called management’s outlook “appropriately conservative,” saying the company is optimistic, but not yet ready to declare a decisive turnaround.
He was encouraged by commentary during Home Depot’s conference call, especially CEO Ted Decker’s candid remarks about the company’s inventory issues. Decker said Home Depot started 2023 with more inventory than he’d like, but after a year progress, he feels “very good about our inventory position” going into 2024. Now that inventory is under control, the company is poised for better future, Cramer said.
“Home Depot’s got a nice catalyst coming in the form of the spring planting season, which is like Christmas for any retailer with a gardening business,” he said. “Besides, I’m betting that management deliberately gave a conservative forecast—they like to under promise and over deliver at Home Depot.”
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