Cramer: Roof Is Collapsing on Home Depot

 | Jul 24, 2017 | 1:12 PM EDT
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When does Home Depot (HD) stop going down?

The sellers are vociferous. It's possible they are saying, "Wait a second, Stanley Black & Decker (SWK) wasn't as strong as we thought and Sherwin-Williams (SHW) and PPG (PPG) aren't as strong as we thought, then wow, that's a huge chunk of Home Depot's aisle space that seems to be on the decline."

I know the DIY chatter on the Sherwin-Williams call was pretty dreadful. I do believe the Amazon (AMZN) foray with Sears (SHLD) and the Sherwin-Williams weakness have made Home Depot into a falling knife.

That said, the problem remains the multiple. Home Depot is 20 times earnings. Companies that have to compete with Amazon have not been able to maintain the same price to earnings multiple as they had before. I question whether this stock has to go to 18-19 times earnings to stabilize.

Watch this one. SWK should have brought out buyers. Nope.

Now it's just more selling and I don't know yet what will stem the decline.

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