Home Depot Inc. (HD)
I decided to not purchase this stock because of based off of it's stock quotes. Starting from the beginning of the year, this stocks percentage change has gone down every month. In January it was up 6.49%, in February it dropped to 2.36% and in March it dropped to 1.87%. Based on this pattern, I believe that it will not increase in April. Currently, its last closing price was 70.69 and its new opening was 70.00. The stock is currently selling for $70.06 and is down 0.89%. The stock is fluctuating within a set range and does not look like it will go any higher.
Last month, the number of jobs in the nation's largest retail stores dropped by over 24,000. According to the article by Steve Hargreaves, "Economists blamed the poor retail performance on colder-than-normal temperatures for much of the country in March, as well as possible fallout from the tax hikes and layoffs from the government's ongoing fiscal woes." Another good point was brought up by Scott Hoyt, a retail economist. He states: "The unusually cold March may have crimped sales and hiring at clothing stores as they tried to switch to warm weather lines. Similarly, the cold weather likely depressed hiring at home improvement stores. You're not out doing the yard work when it's 30 degrees out." The unemployment rates are falling for the wrong reasons and unfortunately there is nothing that the retail stores could have done to prevent that.
I believe that this stock will not increase any higher than it has previously been this year. It highest point this year has been around $73/$74 and over the next two or three months it will probably stay the same, if not lower. Lately it has been dropping and is at $70.06 currently and has been moving in between from $68.00 to $71.00 the last few weeks. It does not look like this stock is going to break out and become worth more than $73.00 at most. We need a stock with a high reward when we purchase it.
Due to the previous information of unemployment within retail stores like home depot, I believe that the company will seek to employ unqualified people to fill posistions. Large retailers like Home Depot cannot afford to have a low staff and will seek to fill the blank positions. Unfortunately, these positions may be filled by unqualified workers. There have been personal experiences in which I have gone to Home Depot and found that the staff seemed to be unknowledgeable regarding my questions and topics. These reasons are enough to make me not buy this stock.
Works Cited:
Hargreaves, Steve. "Retail Jobs Take a Big Hit." CNNMoney. Cable News Network, 05 Apr. 2013. Web. 08 Apr. 2013. <http://money.cnn.com/2013/04/05/news/economy/retail-jobs/index.html>.
-Alexey Shamray
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