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Should I Add Home Depot At These Levels?

Dec. 07, 2018 3:56 PM ETThe Home Depot, Inc. (HD)LEG44 Comments
Brian Soule profile picture
Brian Soule


  • I was in the market for another consumer discretionary stock, but I'm also very interested in adding to an existing position at these levels.
  • One is a fast growing dividend paying stock, the other is a slower growth dividend payer, but with a long history of dividend hikes.
  • I run through my eight guidelines to see which of them, if either, I will be looking to buy at my next opportunity.

I was looking through the portfolio after I put the finishing touches on my last article and realized that the consumer discretionary sector was a little bit light. In fact as I type this it is only 7.3% of my stock portfolio.

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One of my favorite companies, Home Depot Inc (NYSE:HD), is trading very near its 52 week low and is certainly a position I would love to add to. But I also was looking for a third consumer discretionary stock. Is there something better out there? Should I add to my Home Depot position at these levels, or should I hold off and add a third consumer discretionary stock? That is what I will attempt to answer in this article.

To find a new candidate I decided to look at all of the stocks in this sector that are classified as "Dividend Champions". That is, all the stocks with more than 25 straight years of higher dividends. Using The DRiP Investing Resource Center, I filtered the Champions tab to arrive at this table. I have listed all of the consumer discretionary stocks that are also champions below, while the dividend yield I updated at current yields:

Name Symbol # of Yrs Div Yield
Genuine Parts Co. GPC 62 2.79
John Wiley & Sons Inc. JW-A 25 2.44
Leggett & Platt Inc. LEG 47 3.96
Lowe's Companies LOW 56 2.13
McDonald's Corp. MCD 43 2.51
Meredith Corp. MDP 25 3.82
NACCO Industries NC 32 1.92
Target Corp. TGT 51 3.69
VF Corp. VFC 45 2.54
Weyco Group Inc. WEYS 37 2.88

Let's see... I already own the stock with the longest streak in this sector, Genuine Parts Co (GPC), and it is actually faring pretty well in this market so far. I'm not looking

ChartLEG Revenue (Per Share Quarterly) data by YCharts

ChartLEG Book Value (Per Share) data by YCharts

ChartLEG Debt to Equity Ratio (Quarterly) data by YCharts

ChartLEG Payout Ratio (TTM) data by YCharts

ChartLEG Average Diluted Shares Outstanding (Quarterly) data by YCharts

This article was written by

Brian Soule profile picture
I am a financial analyst working in corporate America for a Fortune 500 company. I write the Sand In My Shoes series of articles based on my real-money portfolio, which is the sum of several 401k roll-overs. The title of my articles serves to remind me that my ultimate goal is to retire young and spend more time on the beach and in the sun and less time in a cube with fluorescent lighting.

Analyst’s Disclosure: I am/we are long GPC, HD, HRL, WMT. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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