NYSE:HD

Stock Analysis Report

Executive Summary

The Home Depot, Inc. operates as a home improvement retailer.

Snowflake

Fundamentals

Established dividend payer with proven track record.


Similar Companies

Share Price & News

How has Home Depot's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: HD has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

1.9%

HD

1.4%

US Specialty Retail

0.7%

US Market


1 Year Return

34.0%

HD

13.0%

US Specialty Retail

13.7%

US Market

Return vs Industry: HD exceeded the US Specialty Retail industry which returned 13% over the past year.

Return vs Market: HD exceeded the US Market which returned 13.7% over the past year.


Shareholder returns

HDIndustryMarket
7 Day1.9%1.4%0.7%
30 Day-0.3%3.5%4.7%
90 Day14.1%14.3%6.1%
1 Year37.6%34.0%14.9%13.0%16.2%13.7%
3 Year98.5%84.9%40.7%33.4%48.8%39.2%
5 Year169.9%141.4%50.7%37.9%62.5%44.5%

Price Volatility Vs. Market

How volatile is Home Depot's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Home Depot undervalued compared to its fair value and its price relative to the market?

23.55x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: HD ($237.29) is trading above our estimate of fair value ($232.05)

Significantly Below Fair Value: HD is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: HD is poor value based on its PE Ratio (23.6x) compared to the Specialty Retail industry average (16.4x).

PE vs Market: HD is poor value based on its PE Ratio (23.6x) compared to the US market (18.2x).


Price to Earnings Growth Ratio

PEG Ratio: HD is poor value based on its PEG Ratio (3.5x)


Price to Book Ratio

PB vs Industry: HD has negative assets, so we can't compare its PB Ratio to the US Specialty Retail industry average.


Next Steps

Future Growth

How is Home Depot forecast to perform in the next 1 to 3 years based on estimates from 31 analysts?

6.7%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: HD's forecast earnings growth (6.7% per year) is above the savings rate (2.7%).

Earnings vs Market: HD's earnings (6.7% per year) are forecast to grow slower than the US market (14.4% per year).

High Growth Earnings: HD's earnings are forecast to grow, but not significantly.

Revenue vs Market: HD's revenue (4.1% per year) is forecast to grow slower than the US market (7.3% per year).

High Growth Revenue: HD's revenue (4.1% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: HD's Return on Equity is forecast to be very high in 3 years time (3142.4%).


Next Steps

Past Performance

How has Home Depot performed over the past 5 years?

13.3%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: HD has high quality earnings.

Growing Profit Margin: HD's current net profit margins (10.2%) are higher than last year (9.5%).


Past Earnings Growth Analysis

Earnings Trend: HD's earnings have grown by 13.3% per year over the past 5 years.

Accelerating Growth: HD's earnings growth over the past year (13.2%) is below its 5-year average (13.3% per year).

Earnings vs Industry: HD earnings growth over the past year (13.2%) exceeded the Specialty Retail industry 5.6%.


Return on Equity

High ROE: HD's liabilities exceed its assets, so it is difficult to calculate its Return on Equity.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Home Depot's financial position?


Financial Position Analysis

Short Term Liabilities: HD has negative shareholder equity, which is a more serious situation than short term assets not covering short term liabilities.

Long Term Liabilities: HD has negative shareholder equity, which is a more serious situation than short term assets not covering long term liabilities.


Debt to Equity History and Analysis

Debt Level: HD has negative shareholder equity, which is a more serious situation than a high debt level.

Reducing Debt: HD's has negative shareholder equity, so we do not need to check if its debt has reduced over time.

Debt Coverage: HD's debt is well covered by operating cash flow (49.9%).

Interest Coverage: HD's interest payments on its debt are well covered by EBIT (15.5x coverage).


Balance Sheet

Inventory Level: HD has a high level of physical assets or inventory.

Debt Coverage by Assets: HD has negative shareholder equity (liabilities exceed assets) therefore debt is not covered by short term assets.


Next Steps

Dividend

What is Home Depot's current dividend yield, its reliability and sustainability?

2.29%

Current Dividend Yield


Dividend Yield vs Market

company2.3%marketbottom25%1.4%markettop25%3.6%industryaverage1.9%forecastin3Years2.5%

Current dividend yield vs market & industry

Notable Dividend: HD's dividend (2.29%) is higher than the bottom 25% of dividend payers in the US market (1.42%).

High Dividend: HD's dividend (2.29%) is low compared to the top 25% of dividend payers in the US market (3.65%).


Stability and Growth of Payments

Stable Dividend: HD's dividends per share have been stable in the past 10 years.

Growing Dividend: HD's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (50.7%), HD's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: HD's dividends in 3 years are forecast to be covered by earnings (52.4% payout ratio).


Next Steps

Management

What is the CEO of Home Depot's salary, the management and board of directors tenure and is there insider trading?

8.0yrs

Average management tenure


CEO

Craig Menear (61yo)

5yrs

Tenure

US$11,366,662

Compensation

Mr. Craig A. Menear has been the Chief Executive Officer and President of Home Depot, Inc. since November 1, 2014 and its Chairman of the Board since February 2, 2015. Mr. Menear is the President and Direc ...


CEO Compensation Analysis

Compensation vs Market: Craig's total compensation ($USD11.37M) is about average for companies of similar size in the US market ($USD11.01M).

Compensation vs Earnings: Craig's compensation has been consistent with company performance over the past year.


Management Age and Tenure

8.0yrs

Average Tenure

61yo

Average Age

Experienced Management: HD's management team is seasoned and experienced (8 years average tenure).


Board Age and Tenure

5.7yrs

Average Tenure

60.5yo

Average Age

Experienced Board: HD's board of directors are considered experienced (5.7 years average tenure).


Insider Trading

Insider Buying: HD insiders have only sold shares in the past 3 months.


Recent Insider Transactions

SellUS$2,024,46023 Aug 19
William Lennie
EntityIndividual
Role
Senior Key Executive
Executive Vice President of Outside Sales & Service
Shares9,200
Max PriceUS$220.05
SellUS$1,101,00023 Aug 19
Ann-Marie Campbell
EntityIndividual
Shares5,000
Max PriceUS$220.20
SellUS$12,134,81623 Aug 19
Carol Tomé
EntityIndividual
Shares55,400
Max PriceUS$219.04
SellUS$1,652,23031 May 19
Teresa Roseborough
EntityIndividual
Role
Chief Legal Officer
Executive VP
Shares8,500
Max PriceUS$194.38
SellUS$236,45028 May 19
William Lennie
EntityIndividual
Role
Senior Key Executive
Executive Vice President of Outside Sales & Service
Shares1,250
Max PriceUS$189.16
SellUS$1,006,45206 Mar 19
Ann-Marie Campbell
EntityIndividual
Shares5,450
Max PriceUS$184.67
SellUS$2,203,20001 Mar 19
Mark Holifield
EntityIndividual
Role
Senior Key Executive
Executive VP of Supply Chain & Product Development
Shares12,000
Max PriceUS$183.60
SellUS$461,90211 Dec 18
Teresa Roseborough
EntityIndividual
Role
Chief Legal Officer
Executive VP
Shares2,603
Max PriceUS$177.45
SellUS$374,53630 Nov 18
Ann-Marie Campbell
EntityIndividual
Shares2,166
Max PriceUS$175.73
BuyUS$42,40521 Nov 18
Wayne Hewett
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares250
Max PriceUS$169.62
BuyUS$169,33021 Nov 18
Manuel Kadre
EntityIndividual
Shares1,000
Max PriceUS$169.33
BuyUS$2,004,10521 Nov 18
Mark Vadon
EntityIndividual
Shares11,500
Max PriceUS$174.27

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Management Team

  • Bill Lennie (63yo)

    Executive Vice President of Outside Sales & Service

    • Tenure: 16.3yrs
  • Craig Menear (61yo)

    Chairman

    • Tenure: 5yrs
    • Compensation: US$11.37m
  • Mark Holifield (63yo)

    Executive VP of Supply Chain & Product Development

    • Tenure: 13.3yrs
    • Compensation: US$4.01m
  • Matthew Carey (54yo)

    Executive VP & Chief Information Officer

    • Tenure: 11.2yrs
    • Compensation: US$3.88m
  • Ted Decker (56yo)

    Executive Vice President of Merchandising

    • Tenure: 13.1yrs
    • Compensation: US$3.99m
  • Isabel Janci

    VP of Investor Relations & Treasurer

    • Tenure: 1.8yrs
  • Teresa Roseborough (60yo)

    Executive VP

    • Tenure: 8yrs
  • Richard McPhail

    CFO & Executive VP

    • Tenure: 0.3yrs
  • Stephen Holmes

    Vice President of Corporate Communications

    • Tenure: 0yrs
  • Timothy Hourigan (62yo)

    Executive Vice President of Human Resources

    • Tenure: 2.4yrs

Board Members

  • Gerard Arpey (60yo)

    Independent Director

    • Tenure: 4.3yrs
    • Compensation: US$295.00k
  • Greg Brenneman (57yo)

    Independent Lead Director

    • Tenure: 5.5yrs
    • Compensation: US$360.00k
  • Ari Bousbib (58yo)

    Independent Director

    • Tenure: 12yrs
    • Compensation: US$300.00k
  • Jeff Boyd (62yo)

    Independent Director

    • Tenure: 3.1yrs
    • Compensation: US$295.00k
  • Al Carey (67yo)

    Independent Director

    • Tenure: 11.8yrs
    • Compensation: US$300.00k
  • Helena Foulkes (55yo)

    Independent Director

    • Tenure: 6.2yrs
    • Compensation: US$295.00k
  • Craig Menear (61yo)

    Chairman

    • Tenure: 5yrs
    • Compensation: US$11.37m
  • Wayne Hewett (54yo)

    Independent Director

    • Tenure: 5.8yrs
    • Compensation: US$292.50k
  • Linda Gooden (66yo)

    Independent Director

    • Tenure: 4.1yrs
    • Compensation: US$290.00k
  • Joseph Brown (62yo)

    Independent Director

    • Tenure: 8.4yrs
    • Compensation: US$315.00k

Company Information

The Home Depot, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: The Home Depot, Inc.
  • Ticker: HD
  • Exchange: NYSE
  • Founded: 1978
  • Industry: Home Improvement Retail
  • Sector: Retail
  • Market Cap: US$259.869b
  • Shares outstanding: 1.10b
  • Website: https://www.homedepot.com

Number of Employees


Location

  • The Home Depot, Inc.
  • 2455 Paces Ferry Road
  • Atlanta
  • Georgia
  • 30339
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
HDNYSE (New York Stock Exchange)YesCommon StockUSUSDSep 1981
HD *BMV (Bolsa Mexicana de Valores)YesCommon StockMXMXNSep 1981
HDIXTRA (XETRA Trading Platform)YesCommon StockDEEURSep 1981
HDIDB (Deutsche Boerse AG)YesCommon StockDEEURSep 1981
HDSNSE (Santiago Stock Exchange)YesCommon StockCLUSDSep 1981
HDSWX (SIX Swiss Exchange)YesCommon StockCHCHFSep 1981
HDWBAG (Wiener Boerse AG)YesCommon StockATEURSep 1981
HDBASE (Buenos Aires Stock Exchange)CEDEAR EACH REPR 1/4 COM STK USD0.05ARARSSep 2001
HOME34BOVESPA (Bolsa de Valores de Sao Paulo)BDR EACH REPR 0.5 COM USD0.05BRBRLAug 2012

Biography

The Home Depot, Inc. operates as a home improvement retailer. It operates The Home Depot stores that sell various building materials, home improvement products, lawn and garden products, and décor products ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/11/17 23:38
End of Day Share Price2019/11/15 00:00
Earnings2019/08/04
Annual Earnings2019/02/03


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.