5 Biggest Stocks that Benefit from Rising Interest Rates

3. The Home Depot, Inc. (NYSE:HD)

Number of Hedge Fund Holders: 89

The Home Depot, Inc. (NYSE:HD) is an Atlanta, Georgia-based retailer of home improvement products.

The Home Depot, Inc. (NYSE:HD) issues store cards backed by Citigroup Inc. The store card offers 0% interest for six months; however, if the customer is unable to pay their credit balance in full, they will be charged interest for the whole six-month period. Furthermore, rising interest rates favor The Home Depot, Inc. (NYSE:HD) as consumers do not opt for mortgaging new homes due to higher costs and thus remain restricted to making home improvements only. In an update issued to investors on December 13, Max Rakhlenko at Cowen increased the target price for The Home Depot, Inc. (NYSE:HD) stock from $350 to $379 and maintained an Outperform rating. The analyst appreciated the company’s growth momentum.

Matrix Asset Advisors shared its outlook on The Home Depot, Inc. (NYSE:HD) in its Q3 2022 investor letter. Here’s what the firm said:

“During the quarter, we re-established a position in The Home Depot, Inc. (NYSE:HD) sold earlier this year, after the shares declined sharply on big picture concerns about a softer housing market and lower consumer spending. We believe that HD is a very well-managed company, positioned to continue showing good profits even as the economy decelerates. The products it carries in inventory are in year-round demand from contractors and homeowners wanting to maintain and improve their homes. The company has historically been shareholder friendly, repurchasing shares and increasing the dividend, most recently by 15% earlier this year. On September 30, HD’s current dividend yield was 2.8%.”