Key insights
- Home Depot reports earnings tomorrow amid interest rate uncertainty and a recent stock decline. Multiple insiders, including a member of Congress, have recently purchased shares. Historical data suggests that following Congressional trades in consumer cyclical stocks has been profitable. This insider buying activity, combined with the stock's recent dip, suggests a potential for a positive earnings surprise and a rebound in the stock price.
House Rep. David Taylor disclosed a Home Depot buy on May 8. If you copied His Consumer Cyclical trades when they were publicly disclosed and sold 90d later:
- +14.5% median 90-day return * 77.8% win rate * +9.6% median vs SPY
The stock is already down ~6% since May amid interest rate uncertainty.
Could tomorrow’s earnings deliver a rebound? Interestingly, 4 insiders have filed Home Depot buys in the past month.
Congressional timing edge + fresh insider buying heading into the report. Worth watching.