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Market Cap

US$343.2b

Last Updated

2021/04/10 22:05 UTC

Data Sources

Company Financials +

Executive Summary

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


Snowflake Analysis

Established dividend payer with mediocre balance sheet.


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 is less volatile than 75% of US stocks over the past 3 months, typically moving +/- 3% a week.

Volatility Over Time: HD's weekly volatility (3%) has been stable over the past year.


Market Performance


7 Day Return

3.7%

HD

3.7%

US Specialty Retail

2.1%

US Market


1 Year Return

58.4%

HD

116.8%

US Specialty Retail

56.3%

US Market

Return vs Industry: HD underperformed the US Specialty Retail industry which returned 114.1% over the past year.

Return vs Market: HD exceeded the US Market which returned 55.3% over the past year.


Shareholder returns

HDIndustryMarket
7 Day3.7%3.7%2.1%
30 Day18.7%3.6%2.4%
90 Day18.6%16.1%6.1%
1 Year62.1%58.4%118.1%116.8%59.1%56.3%
3 Year98.7%84.7%116.8%108.2%65.7%55.1%
5 Year165.8%136.4%111.0%95.1%122.3%97.6%

Long-Term 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?

26.65x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: HD ($319.23) is trading above our estimate of fair value ($232.24)

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 (26.6x) compared to the US Specialty Retail industry average (20.2x).

PE vs Market: HD is poor value based on its PE Ratio (26.6x) compared to the US market (22.3x).


Price to Earnings Growth Ratio

PEG Ratio: HD is poor value based on its PEG Ratio (4.6x)


Price to Book Ratio

PB vs Industry: HD is overvalued based on its PB Ratio (104.2x) compared to the US Specialty Retail industry average (3.1x).


Future Growth

How is Home Depot forecast to perform in the next 1 to 3 years based on estimates from 29 analysts?

5.9%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: HD's forecast earnings growth (5.9% per year) is above the savings rate (2%).

Earnings vs Market: HD's earnings (5.9% per year) are forecast to grow slower than the US market (18.7% per year).

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

Revenue vs Market: HD's revenue (3.8% per year) is forecast to grow slower than the US market (9.9% per year).

High Growth Revenue: HD's revenue (3.8% 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 (280.3%).


Past Performance

How has Home Depot performed over the past 5 years?

11.9%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: HD has high quality earnings.

Growing Profit Margin: HD's current net profit margins (9.7%) are lower than last year (10.2%).


Past Earnings Growth Analysis

Earnings Trend: HD's earnings have grown by 11.9% per year over the past 5 years.

Accelerating Growth: HD's earnings growth over the past year (14.5%) exceeds its 5-year average (11.9% per year).

Earnings vs Industry: HD earnings growth over the past year (14.5%) underperformed the Specialty Retail industry 29.1%.


Return on Equity

High ROE: Whilst HD's Return on Equity (390%) is outstanding, this metric is skewed due to their high level of debt.


Financial Health

How is Home Depot's financial position?


Financial Position Analysis

Short Term Liabilities: HD's short term assets ($28.5B) exceed its short term liabilities ($23.2B).

Long Term Liabilities: HD's short term assets ($28.5B) do not cover its long term liabilities ($44.1B).


Debt to Equity History and Analysis

Debt Level: HD's debt to equity ratio (1044.9%) is considered high.

Reducing Debt: HD's debt to equity ratio has increased from 335.8% to 1044.9% over the past 5 years.

Debt Coverage: HD's debt is well covered by operating cash flow (54.7%).

Interest Coverage: HD's interest payments on its debt are well covered by EBIT (15.9x coverage).


Balance Sheet


Dividend

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

2.07%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: HD's dividend (2.07%) is higher than the bottom 25% of dividend payers in the US market (1.27%).

High Dividend: HD's dividend (2.07%) is low compared to the top 25% of dividend payers in the US market (3.5%).


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 (51.3%), 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 well covered by earnings (49.3% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

5.2yrs

Average management tenure


CEO

Craig Menear (62 yo)

6.42yrs

Tenure

US$10,889,833

Compensation

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


CEO Compensation Analysis

Compensation vs Market: Craig's total compensation ($USD10.89M) is about average for companies of similar size in the US market ($USD10.94M).

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


Leadership Team

Experienced Management: HD's management team is seasoned and experienced (5.2 years average tenure).


Board Members

Experienced Board: HD's board of directors are considered experienced (6.5 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

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


Top Shareholders

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$343.244b
  • Shares outstanding: 1.08b
  • Website: https://www.homedepot.com

Number of Employees


Location

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

Listings


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, building materials, lawn and garden products...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/04/10 22:05
End of Day Share Price2021/04/09 00:00
Earnings2021/01/31
Annual Earnings2021/01/31


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.