NEW YORK (AP) -- A Jefferies analyst boosted his rating and price target for Home Depot on Friday, saying that chilly weather will likely not hurt the home improvement company's first-quarter sales.
Analyst Daniel Binder raised Home Depot Inc. to "Buy" from "Hold" and increased its price target to $85 from $64. In a client note, the analyst said that even though the weather has been cool so far this spring, he still believes the chain's first-quarter sales at stores open at least a year will be better than expected.
Sales at stores open at least a year is a key gauge of a retailer's health because it excludes results from stores recently opened or closed.
While the housing market continues to make a gradual recovery, Binder says he is most upbeat about rising home prices.
"We are most encouraged by the improvement in home prices since we think an appreciating asset is much easier for the homeowner to invest in than a depreciating one - not just psychologically, but from a credit perspective as well," he wrote.
A representative for Home Depot did not immediately respond to an email seeking comment.
Shares of Home Depot, which is based in Atlanta, rose 78 cents, or 1.1 percent, to $72.68 in trading 2½ hours ahead of the market opening. For the year to date, the stock is up 16.2 percent.