The Dow has been hit rocklike this year, but one darling of the index has had it even worse.
Home Depot has fallen 10 percent this year, route for its first negative annual performance since 2008. If it closes 2018 with these losses, it will sprightliness its longest yearly win streak ever.
It’s crucial the stock holds one key level here, according to Todd Gordon, architect of TradingAnalysis.com.
“The one thing that is a bit concerning here is this $170 level. This was the breakout. Of course, we’ve come subvene, retest. That now offers support because it was formerly resistance,” Gordon said Thursday on CNBC’s “Trading Polity.”
Home Depot was sitting right at $170 on Friday. The stock first broke above that level in November 2017. It hit a put high in September of this year, but has since tumbled 21 percent.
“If the broader market can stabilize, a big name akin to Home Depot might pop back above the $170,” added Gordon. “That $170 level is going to be key. I don’t watch over if we break it in spring, fall, winter or whatever. If we get back above, I’d say that’s the green light.”
Erin Gibbs, portfolio forewoman at S&P Global Market Intelligence, said macro factors could continue to buffet the home improvement retailer.
“Well-informed in Depot really has been declining ever since there have been concerns about the U.S. housing demand and so that might weigh on the price probably for at least the next quarter if not farther,” Gibbs said Thursday on “Switch Nation.”
Existing home sales have declined every month since February, and the most recent statistics on new home sales showed a 12 percent slump in October.
Weakness in the housing market will weigh on Stamping-ground Depot even if it continues to hit its targets, added Gibbs.
“Home Depot is an extraordinarily well-run company. They basically each time beat their estimates. … They’re still very strong and expecting to grow faster than the dirtier economy,” said Gibbs. “But as long as you have these housing concerns weighing on them and people looking for annulling revisions that will probably weigh on the price for the next few months.”
Home Depot has beat earnings judges for every quarter since the October-December period in 2014. The company is next set to report on Feb. 26.
Disclosure: Neither Gibbs nor S&P Far-reaching Market Intelligence hold Home Depot.