Investors who have owned stocks since 2016 generally have experienced some big gains. In fact, the SPDR S&P 500 (NYSE: SPY) total return in the past five years is 123.8%. But there is no question some big-name stocks performed better than others along the way.
Home Depot Struggles: One company that has been a solid investment in the past five years is home improvement retailer Home Depot Inc (NYSE: HD).
Home Depot is one of countless brick-and-mortar retailers that have thrived in the face of online competition from Amazon.com, Inc. (NASDAQ: AMZN) in recent years. The downturn in the U.S. housing market hit Home Depot hard back in 2008 and 2009, forcing the company to issue aggressive layoffs and close 54 stores. Fortunately, a leaner Home Depot was then positioned to thrive in the 2010s.
Under CEO Craig Menear’s leadership, Home Depot consistently reported same-store sales growth that outpaced not only the rest of the retail sector, but also top competitor Lowe’s Companies Inc (NYSE: LOW) in the past five years. Americans stuck at home in 2021 poured money into home improvement projects, sending Home Depot’s sales numbers into record territory.
At the beginning of 2016, Home Depot shares were trading at around $130. Home Depot dropped as low as $109.62 in early 2016. Fortunately, that level would mark the stock’s low point of the past five years as Home Depot consistently put up impressive same-store sales growth numbers.
The stock broke $200 for the first time in early 2018, hitting $215.43 mid-year before pulling back. Home Depot bounced at $158.09 in late 2018 and was back at hew all-time highs by summer 2019.
Home Depot In 2021, Beyond: Home Depot took a big hit along with the rest of the market in March 2020. The stock dropped as low as $140.63, rebounding a new all-time high of $292.95 in mid-2020. Since then, the stock has pulled back to around $278.
Home Depot investors who bought five years ago and held on have generated a solid return on their investment. In fact, $1,000 in Home Depot stock bought in 2016 would be worth about $2,582 today, assuming reinvested dividends.
Looking ahead, analysts are expecting new highs for Home Depot in the next 12 months. The average price target among the 29 analysts covering the stock is $312, suggesting 12.2% upside from current levels.
(Photo: The Home Depot)
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