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Home Depot Inc. share price up, data breach scale exceedes expectations, about 56 million cards affected

Home Depot Inc. revealed in an official statement that about 56 million credit and debit cards were subject to data breach in the period from April to September 2014. The hacker attack exceeded the scale of the one against Target Corp. in 2013. The companys Chairman and Chief Executive Officer Mr. Frank Blake apologized for the “inconvenience and anxiety”, which was caused to Home Depots customers as a result of the attack.

“We apologize to our customers for the inconvenience and anxiety this has caused, and want to reassure them that they will not be liable for fraudulent charges,” Chief Executive Officer Frank Blake said in the statement. “From the time this investigation began, our guiding principle has been to put our customers first, and we will continue to do so.”

This was the first time when the U.S.-based retailer has been more specific about the scale of a breach. In addition, the company assured that the malware has been eliminated from its systems and that the method of entry has been sealed. Home Depot said that it was working “around the clock” with its banking partners, IT security companies and the Secret Service in order to reveal the breachs source.

According to the statement, the hackers used custom-made software in order to evade detection and that the malware had not been seen in previous attacks. An investigation of the data breach has been started by the company on September 2nd, after several of its banking partners and law enforcement institutions signaled it may have been affected by a hacker attack. Home Depot also said that stores in Mexico and online customers were likely unaffected by the breach and that there is no evidence of debit PIN codes being compromised.

The data breach further emphasizes on U.S. retailers payment systems vulnerability. According to people with knowledge of the situation, that is the reason why the company has started a project of full encryption of its payment terminal data in 2014. However, hackers proved to be faster and outpaced the process. Home Depot revealed that the encryption project is now finalized in the U.S. and will be completed in Canada by early 2015.

Home Depot Inc. settled 0.95% higher on Thursday in New York at $92.09 per share, marking a one-year change of +19.03%. The company is valued at $122.78 billion. According to CNN Money, the 26 analysts offering 12-month price forecasts for Home Depot Inc. have a median target of $98.50, with a high estimate of $104.00 and a low estimate of $78.00. The median estimate represents a +6.96% increase from the last price of $92.09.

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