The Target hack happened less than a year ago following the Black Friday consumer feeding frenzy we know as the holiday season. Customers of Target between November 27 and December 15 were the targets of international hackers who took customer names and credit card information. Target initially reported that 40 million people were affected by the hack but later in January it disclosed that an additional 70 million (per CNBC) more were affected potentially totaling at 110 million with some overlap in the numbers.
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Home Depot has not released much information regarding the potential hack but there is a concern brought up by Brian Krebs that this could be larger than the breach at Target. Home Depot operates 2,200 stores compared to Target’s 1,800 stores. Keep in mind that Target was hacked over the course of three weeks, and Home Depot has not released a time-table for the alleged hack. As of Thursday, the stock reaction has been one that indicates that Home Depot’s long-term impact is not likely as bad as that of Target.
In the wake of this, both companies are undertaking measures to safeguard customer information going forward in part by instituting chip-enable checkout terminals to facilitate more secure transactions. Banking partners have also been defensively monitoring customer accounts who were potentially targets.
If the Home Depot breach is anywhere close to as extensive as Target’s breach, that has not been reflected in the stock. Home Depot shares peaked above $93 prior to the hack news, but then the stock fell to $91.15 by Tuesday’s close and then to $89.00 on Wednesday’s close. Home Depot shares recovered by 1% to $89.93 by Thursday’s closing bell.
If you compare Target’s breach, the stock took less than one month to fall from $63 to $around $55. Each major recovery, the first to back above $62, was met with further problems. Target lost key management over the incident.
The market is so far not as worried that Home Depot’s breach impact will be anywhere close to as bad as Target’s. It may be too soon to formally make that verdict without having all the facts, but the first indication based on the stock reaction sure seems to be that Target took worse of a hit than Home Depot. Again, it is too soon to know.
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