Home Depot shares fall for a second straight session on Wednesday, company announces safety measures, additional bonuses for associates

Home Depot Inc (HD) on Wednesday announced several measures for the safety of its clients and associates as well as several additional benefits for its staff.

Home Depot shares closed lower for a second consecutive trading session in New York on Wednesday. The stock went down 4.33% ($8.08) to $178.63, after touching an intraday low at $175.30, or a price level not seen since March 24th ($173.01).

Shares of Home Depot Inc have retreated 18.20% so far in 2020 compared with a 23.53% loss for the benchmark index, S&P 500 (SPX).

In 2019, Home Depot’s stock went up 27.10%, thus, it underperformed the S&P 500, which registered a 28.88% gain.

Home Depot said that it would now close stores early at 6:00 PM to allow more time for sanitization and restocking.

It would also restrict the number of customers allowed into the stores at one and the same time.

Another measure will be the promotion of social and physical distancing practices in stores by marking floors and adding signage.

Last but not least, the company will discontinue major spring promotions to avoid prompting high levels of store traffic.

Home Depot also said that it would provide additional bonuses to hourly employees in stores and distribution centers. Full-time hourly associates are to receive a weekly bonus of $100, while part-time hourly associates – a weekly bonus of $50.

Hourly associates will also receive double pay for overtime hours worked, Home Depot said.

Additionally, the company announced extended dependent care benefits and waived co-pays.

Meanwhile, all Home Depot associates in store support functions, who can work remotely, will be advised to do so, the company said.

“As our communities battle COVID-19, The Home Depot is committed to providing the essential needs required to maintain homes and businesses while doing our best to protect our valued customers and associates. This has resulted in several temporary changes to our business as we look out for your safety and the safety of our associates,” Craig Menear, Home Depot’s Chairman, President and Chief Executive Officer, said in a press release.

Analyst stock price forecast and recommendation

According to CNN Money, the 27 analysts, offering 12-month forecasts regarding Home Depot’s stock price, have a median target of $235.00, with a high estimate of $288.00 and a low estimate of $187.00. The median estimate represents a 31.56% upside compared to the closing price of $178.63 on April 1st.

The same media also reported that at least 17 out of 31 surveyed investment analysts had rated Home Depot’s stock as “Buy”, while 9 – as “Hold”.

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