Morgan Stanley Maintains Buy Rating on Home Depot (HD) Stock

On May 20, Simeon Gutman, a Morgan Stanley analyst, maintained a Buy rating on Home Depot (NYSE:HD) and raised the associated price target to $415.00.

The rating came after the company released its fiscal Q1 2025 earnings, with net earnings of $3.4 billion compared to $3.6 billion in the same period last year.

A home improvement store overflowing with a variety of products and supplies.

The analyst expressed confidence in a positive outlook for Home Depot (NYSE:HD), saying that the rating upgrade is backed by a favorable risk/reward profile with a bull case scenario that reflects key potential gains.

Despite that, Gutman’s analysis includes growth in EPS estimates for 2025 and 2026, attributed to anticipated improvements in operating margins and comparable sales. The analyst’s forecast also encompasses leverage in selling, general, and administrative expenses and a modest expansion in gross margins that support the Buy rating when coupled with a temporary pause in share buybacks and a stable tax rate.

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Disclosure: None.