The market's pulling down Home Depot (HD) and it might just very well be an opportunity. You have to go listen to this conference call to realize that Home Depot is firing on only a few cylinders. There's no housing recovery. Homes aren't selling and they aren't being built in any big numbers. You have very little incentive to fix your home up.
At the same time there is rampant inflation in the system and many companies have had a really hard time passing on costs. Home Depot, though, has been able to beat up on suppliers, take share from those other retailers in the segment and get its supply chain costs so low that it can make much more money despite much lower sales.
We know oil's hurting today's market. We know that Dow 13,000 seems to have triggered some automatic selling.
But I think Home Depot is a good place to go when there is a market-related sell-off. If HD can make this much money in this environment you can only imagine how much it can make in a better one with a real housing recovery and a real spring homebuying season.
Random musings: Weatherford (WFT) is a constant remember that accounting irregularities equals SELL!
