FY20 targets: Strong top-line, investments to ramp
HD released its FY20 targets ahead of its analyst day today, which included strong top-line expectations, with sales guided to between $114.7bn and $119.8bn vs. consensus $113.3bn. However, operating margins are guided to 14.4%-15.0%, below the consensus ~15.5%. While we note that previous long-term targets have proved conservative, this guidance implies limited margin expansion over the next three years, as the company "accelerates its investments". We will be looking for more detail on these planned investments during the analyst day, but the margin outlook is likely to receive attention.The Home Depot is a home improvement retailer. The company provides its customers an assortment of building materials, home improvement products, lawn and garden products, and decor products and provides a number of services, including home improvement installation services and tool and equipment rental. The company also maintains a network of distribution and fulfillment centers, as well as a number of e-commerce websites. The company provides a number of programs for its Professional Customers to meet their particular needs, and for its Do-It-Yourself and Do-It-For-Me customers, the company provides a number of installation services. The company also provides tool and equipment rentals for its customers.
Formed in 2003 by an established team from Cazenove, one of the most respected investment banks in the UK, Atlantic Equities conducts and publishes fundamental, bottom up research on mid and large cap US companies.
Atlantic provide order execution through a wide range of DMA products and algorithmic trading suites.
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