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Home Depot: A Stock Cannibal That May Beat The Market

May 11, 2023 6:38 AM ETThe Home Depot, Inc. (HD)6 Comments
Tangerine Capital profile picture
Tangerine Capital


  • Home Depot is the world's largest home improvement retailer with a moat that should protect its earnings.
  • They are also very shareholder friendly and one of the best capital allocators in North America.
  • As such, their prospects are excellent and should reward patient, long-term investors with market-beating returns.

Home Depot Raises Its Minimum Wage For Workers

Justin Sullivan


Home Depot (NYSE:HD) is a company with an excellent management team that really knows how to allocate capital efficiently. As a result, shareholders have been handsomely rewarded over the past few decades. And I expect Home Depot to

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Tangerine Capital profile picture
My primary area of concentration will be on identifying companies of exceptional caliber, with a proven ability to reinvest capital for impressive returns. Targeting those with a market capitalization of less than $10 billion, affords ample opportunities for growth. The ideal scenario is for these companies to demonstrate a long-term capability of capital compounding, with a high enough compound annual growth rate to potentially deliver tenfold returns or even greater.My approach is to maintain a long-term perspective on these companies, as I believe this will generate higher returns compared to the market index, in a rapidly evolving investment landscape where short-term holdings are becoming increasingly prevalent.I primarily adopt a conservative investment strategy, but occasionally I may pursue opportunities with a favorable risk-reward ratio where the potential upside is substantial and downside is limited. These ventures are carefully considered and allocated a proportional amount within my portfolio to maintain overall stability.I try to analyze as many companies as possible to find the ones worth investing in. All ideas and articles are provided for informational and educational purposes. Nothing contained herein is investment advice or should be construed as investment advice. All decisions that you make after reading our articles and reports are 100% your responsibility.

Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, but may initiate a beneficial Long position through a purchase of the stock, or the purchase of call options or similar derivatives in HD over the next 72 hours. 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.

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Comments (6)

nbr3bagshotrow profile picture
How many more stores can they add to keep the income track going?
Very well managed best of breed HD, should be a core holding in any portfolio.
birder profile picture
I have just initiated a position in HD. It has a stellar long term record and it appears to me to be very inexpensive currently. It also pays a reasonable dividend.
Just had another HD article that discussed selling due to real estate sector slowing. We just need to read the tea leaves and make our own decision. In the short term the stock may drop a bit but long-term it’s a rock solid corporation
Tangerine Capital profile picture
@Erick The Tech Bull Over the long term, Home Depot should be a safe bet. The combination of earnings growth, share buybacks and rising dividends is just one combination that is destined to compound, and time arbitrage is the individual investor's best friend.
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