According Morgan Stanley,
$360 PT represents ~19.5x our 2024e EPS of $18.20, or ~14x our 2024e EBITDA of ~$27.8b. Home improvement sees demand moderation in '23 and growth in '24. In '22/'23/'24 we forecast comps of 3.3%/0.5%/3.5%, GM -10 bps/flat/flat, and +2.7%/+0.5%/+3% SG&A per sq ft growth. This drives ~15 bps of cumulative EBIT margin expansion in 2022-2024, with +5%/flattish/+4% EBIT growth.
Risks to Upside
Housing market accelerates through and beyond COVID-19 disruption
Initiatives gain momentum and drive top line acceleration in 2022/2023
Risks to Downside
A slowdown in the Home Improvement market
More than expected interest rate hikes
Departure of key leadership
$360 PT represents ~19.5x our 2024e EPS of $18.20, or ~14x our 2024e EBITDA of ~$27.8b. Home improvement sees demand moderation in '23 and growth in '24. In '22/'23/'24 we forecast comps of 3.3%/0.5%/3.5%, GM -10 bps/flat/flat, and +2.7%/+0.5%/+3% SG&A per sq ft growth. This drives ~15 bps of cumulative EBIT margin expansion in 2022-2024, with +5%/flattish/+4% EBIT growth.
Risks to Upside
Housing market accelerates through and beyond COVID-19 disruption
Initiatives gain momentum and drive top line acceleration in 2022/2023
Risks to Downside
A slowdown in the Home Improvement market
More than expected interest rate hikes
Departure of key leadership
