Business Description
The Home Depot, Inc. operates as a prominent retailer specializing in home renovation and improvement. Through its expansive network of "The Home Depot" stores, it furnishes consumers with an extensive array of goods, including building materials, home enhancement products, lawn and garden supplies, decorative items, and facilities maintenance, repair, and operational (MRO) supplies. In addition to selling products, the company extends professional installation services for key home features like flooring, cabinetry (including makeovers), countertops, furnaces and central air conditioning systems, and window replacements. Customers can also access tool and equipment rental options. Its diverse clientele includes both individual homeowners and a broad spectrum of professional clients, such as renovators, general contractors, maintenance personnel, handymen, property managers, building service contractors, and specialized tradespeople like electricians, plumbers, and painters. The firm also distributes its merchandise through several online platforms, notably homedepot.com, along with specialized sites such as blinds.com for bespoke window coverings and thecompanystore.com for home textiles and decorative goods. By the end of 2021, the corporation operated a total of 2,317 outlets across the United States. Incorporated in 1978, The Home Depot, Inc. maintains its corporate headquarters in Atlanta, Georgia.
Business History
Generated: Jun 24, 2026 3:02amPrice Overview
Last updated: Jun 24, 2026 3:00am (3d ago)Price History (1 Year)
Revenue & Net Income Trend
| Period | Revenue | Net Income | Net Margin | YoY/QoQ |
|---|
Key Metrics
EPS (Diluted): 14.27
Total Equity: $12.81B
Shares: 997,000,000
Total Debt: $55.77B
Cash: $1.39B
EBITDA: $24.29B
Total Debt: $55.77B
Cash: $1.39B
Revenue: $164.68B
Revenue: $164.68B
Revenue: $164.68B
Total Equity: $12.81B
Tax Rate: 23.9%
Equity: $12.81B
Total Debt: $55.77B
Cash: $1.39B
Current Liabilities: $32.42B
Long-Term Debt: $46.34B
Total Debt: $55.77B
Total Equity: $12.81B
Shares: 997,000,000
Shares: 997,000,000
CapEx: -$3.68B
Shares: 997,000,000
Stock Price: $324.45
Net Income: $14.16B
Industry Benchmarks
Advanced Analysis Forensic deep-dive · three lenses
Home Depot is a mature, scaled retailer throwing off real cash: FCF of $12.65B on $164.68B revenue (2026), with OCF/NI of 1.15x, accruals at -2.4% of assets, Beneish M of -2.39 and Altman Z of 5.61. Earnings quality is clean and the mechanical checks show no manipulation flags. Capital return discipline is excellent - diluted share count fell from 1.06B (2022) to 997M (2026), a -1.5% CAGR, with buybacks running 1,427% of SBC and SBC just 0.3% of revenue. Per-share value is genuinely being concentrated.
Verify before trusting this (5)
- Drivers of 260 bps operating margin compression 2023-2026 - mix shift, SRS integration costs, wage/freight, or pricing pressure
- Working capital and capex detail behind FCF stepdown from $17.95B to $12.65B
- Debt maturity ladder and refinancing schedule given $9.43B short-term debt vs $1.39B cash
- Pro contractor vs DIY revenue mix and same-store sales trend
- SRS Distribution acquisition contribution and goodwill/intangibles created
The valuation stack is unusually tight and all points well below market: DCF $226.54, EPV floor $166.21, anchored P/E $258.09, composite $219.35, signal-adjusted $176.32. Even the most generous method (anchored P/E, which already bakes in HD's premium multiple) sits ~20% below the $324.45 print. The EPV floor at $166 is a useful sanity check on what the steady-state cash machine is worth without growth - and the stock is nearly 2x that. To justify $324 the market needs a return to mid-single-digit comps, margin re-expansion back toward the 15%+ peak, and continued multiple support - a heroic combination given op margin has compressed every year since 2023, net income is ~17% off peak, and FCF stepped down. Earnings quality is high and the business is Strong (quality 27), which legitimately raises deserved value above the raw DCF - call it ~$240-260 once you credit the franchise. That still leaves price ~25-35% above a fair quality-adjusted anchor. This is not a value setup; it is a quality compounder being asked to grow into its price during a soft patch.
Verify before trusting this (5)
- Forward comp guidance and Pro segment momentum on next print
- Operating margin trajectory - is the 2023-onward compression bottoming
- FCF run-rate vs capex and buyback pace
- Any management commentary on housing turnover and big-ticket discretionary
- Whether anchored P/E method is using a stale premium multiple
HD sits in an awkward sentiment pocket. The macro tape is neutral with VIX at 19.5 and the S&P off 3% from highs, but the active subtext is rates-stay-higher (10y at 4.5%) and a Fed that just held - both of which land directly on housing-tied names. HD's beta is sub-1, so it is not getting whipped by the tape, but the rate-sensitivity channel is specific and live: the news flow explicitly cites HD and LOW falling on the Fed hold. That is sector-specific pressure, not generic risk-off. The narrative itself is platform-monopoly with only moderate intensity and low cult - meaning there is no euphoric story bid to defend the multiple if the housing cycle keeps rolling over. The bear framing (peaked cycle, normalized DIY, valuation requiring multi-year mid-teens EPS growth) is the one currently being validated by the tape, and today's Wolfe downgrade to Peer Perform with a rotation INTO Target is exactly the kind of analyst-tone crack that matters more than the stale Buy consensus. Offsetting tailwinds exist but are softer: O'Leary endorsement, 157-quarter dividend streak, margin guidance reaffirmed, and a $373 consensus target still ~15% above spot. Net, the live pressure leans negative - not violent, but persistent.
Verify before trusting this (5)
- Whether other sell-side desks follow Wolfe with downgrades or target cuts in the next 2-3 weeks
- Housing data prints (permits, starts, existing home sales) - any further softening reinforces the bear narrative
- 10y yield direction; a move back below 4.2% would meaningfully relieve sentiment pressure
- Next HD comps print and Pro segment commentary - the one place a positive narrative crack could form
- Relative performance vs LOW and TGT - if HD lags both, the rotation call is sticking
Deep Analysis
Pre-flight intelligence scans the company first, then routes to the right analytical methods.
Income Statement (Annual)
Last updated: Jun 24, 2026 3:02am (3d ago)| Metric | 2022 | 2023 | 2024 | 2025 | 2026 |
|---|---|---|---|---|---|
| Revenue | $151.2B | $157.4B | $152.7B | $159.5B | $164.7B |
| Cost of Revenue | $100.3B | $104.6B | $101.7B | $106.2B | $109.8B |
| Gross Profit | $50.8B | $52.8B | $51.0B | $53.3B | $54.9B |
| Operating Expenses | $27.8B | $28.7B | $29.3B | $31.8B | $34.0B |
| Operating Income | $23.0B | $24.0B | $21.7B | $21.5B | $20.9B |
| Net Income | $16.4B | $17.1B | $15.1B | $14.8B | $14.2B |
| EBITDA | $25.9B | $27.1B | $25.1B | $25.4B | $24.3B |
| EPS | $15.59 | $16.74 | $15.16 | $14.96 | $14.27 |
| EPS (Diluted) | — | — | — | — | — |
Balance Sheet (Annual)
Last updated: Jun 24, 2026 3:02am (3d ago)| Metric | 2022 | 2023 | 2024 | 2025 | 2026 |
|---|---|---|---|---|---|
| Cash & Equivalents | $2.3B | $2.8B | $3.8B | $1.7B | $1.4B |
| Total Current Assets | $29.1B | $32.5B | $29.8B | $31.7B | $34.4B |
| Total Assets | $71.9B | $76.4B | $76.5B | $96.1B | $105.1B |
| Current Liabilities | $28.7B | $23.1B | $22.0B | $28.7B | $32.4B |
| Long-Term Debt | $36.6B | $42.0B | $42.7B | $48.5B | $46.3B |
| Total Liabilities | $73.6B | $74.9B | $75.5B | $89.5B | $92.3B |
| Total Equity | -$1.7B | $1.6B | $1.0B | $6.6B | $12.8B |
| Retained Earnings | $67.6B | $76.9B | $83.7B | $89.5B | $94.5B |
Cash Flow (Annual)
Last updated: Jun 24, 2026 3:02am (3d ago)| Metric | 2022 | 2023 | 2024 | 2025 | 2026 |
|---|---|---|---|---|---|
| Operating Cash Flow | $16.6B | $14.6B | $21.2B | $19.8B | $16.3B |
| Capital Expenditure | -$2.6B | -$3.1B | -$3.2B | -$3.5B | -$3.7B |
| Free Cash Flow | $14.0B | $11.5B | $17.9B | $16.3B | $12.6B |
| Acquisitions (net) | -$421.0M | $0 | -$1.5B | -$17.6B | -$5.4B |
| Debt Repayment | — | — | — | — | — |
| Dividends Paid | — | — | — | — | — |
| Stock Buybacks | -$14.8B | -$6.7B | -$8.0B | -$649.0M | $0 |
| Net Change in Cash | -$5.6B | $414.0M | $1.0B | -$2.1B | -$270.0M |
Analyst Estimates (Annual)
Last updated: Jun 24, 2026 3:00am (3d ago)| Metric | 2028 | 2029 | 2030 | 2031 |
|---|---|---|---|---|
| Revenue |
$177.5B $174.2B – $186.7B
|
$185.1B $185.0B – $185.2B
|
$192.6B $188.9B – $198.2B
|
$195.7B $191.9B – $201.4B
|
| EBITDA |
$28.9B $28.4B – $30.4B
|
$30.2B $30.2B – $30.2B
|
$31.4B $30.8B – $32.3B
|
$31.9B $31.3B – $32.8B
|
| Net Income |
$15.6B $15.5B – $16.4B
|
$17.0B $16.7B – $17.8B
|
$19.0B $18.6B – $19.8B
|
$19.7B $19.3B – $20.5B
|
| EPS | — | — | — | — |
Growth Trends (YoY %)
Last updated: Jun 24, 2026 3:02am (3d ago)| Metric | 2023 | 2024 | 2025 | 2026 |
|---|---|---|---|---|
| Revenue Growth | +4.1% | -3.0% | +4.5% | +3.2% |
| Gross Profit Growth | +3.8% | -3.4% | +4.6% | +2.9% |
| Operating Income Growth | +4.3% | -9.8% | -0.8% | -3.0% |
| Net Income Growth | +4.1% | -11.5% | -2.2% | -4.4% |
| EBITDA Growth | +4.3% | -7.2% | +1.3% | -4.5% |
Insider Trading (Recent)
Last updated: Jun 24, 2026 3:02am (3d ago)All SEC Form 4 codes
- P Purchase
- Open-market or private purchase of shares.
- S Sale
- Open-market or private sale of shares.
- A Award / grant
- Grant or award of securities (RSUs, options, etc.) under Rule 16b-3.
- D Return to issuer
- Securities disposed back to the company under Rule 16b-3.
- F In-kind (tax)
- Shares withheld or delivered to pay the option-exercise price or tax — not an open-market sale.
- I Discretionary
- Discretionary transaction under an employee plan — Rule 16b-3(f).
- M Option exercise
- Exercise or conversion of a derivative (option/RSU) into shares — exempt.
- C Conversion
- Conversion of a derivative security into the underlying shares.
- E Short expiration
- Expiration of a short derivative position.
- H Long expiration
- Expiration or cancellation of a long derivative position with value received.
- O OTM exercise
- Exercise of an out-of-the-money derivative.
- X ITM exercise
- Exercise of an in-the-money or at-the-money derivative.
- G Gift
- Bona fide gift of securities.
- L Small acquisition
- Small acquisition under Rule 16a-6.
- W Inheritance
- Acquisition or disposition by will or the laws of descent.
- Z Voting trust
- Deposit into or withdrawal from a voting trust.
- J Other
- Other acquisition or disposition (explained in a Form 4 footnote).
- K Equity swap
- Transaction in an equity swap or similar instrument.
- U Tender / buyout
- Disposition via tender of shares in a change-of-control transaction.
Compensation-plan codes (A, D, F, M) are routine and rarely directional. Open-market P (buy) and S (sale) carry the most signal.
| Date | Insider | Type | Shares | Price | Value |
|---|---|---|---|---|---|
| 2026-05-28 | Rowe Michael F. | J-Other | 714.12 | $0.00 | $0 |
| 2026-05-21 | Sharma Asha | A-Award | 796.00 | $0.00 | $0 |
| 2026-05-21 | Sharma Asha | A-Award | 191.22 | $0.00 | $0 |
| 2026-05-21 | Seidman Becker Caryn | A-Award | 796.00 | $0.00 | $0 |
| 2026-05-21 | Seidman Becker Caryn | A-Award | 191.22 | $0.00 | $0 |
| 2026-05-21 | Santilli Paula | A-Award | 796.00 | $0.00 | $0 |
| 2026-05-21 | Santilli Paula | A-Award | 191.22 | $0.00 | $0 |
| 2026-05-21 | Kadre Manuel | A-Award | 796.00 | $0.00 | $0 |
| 2026-05-21 | Kadre Manuel | A-Award | 191.22 | $0.00 | $0 |
| 2026-05-21 | Hewett Wayne M. | A-Award | 796.00 | $0.00 | $0 |
| 2026-05-21 | Hewett Wayne M. | A-Award | 270.89 | $0.00 | $0 |
| 2026-05-21 | BRENNEMAN GREGORY D | A-Award | 796.00 | $0.00 | $0 |
| 2026-05-21 | BRENNEMAN GREGORY D | A-Award | 446.17 | $0.00 | $0 |
| 2026-05-21 | BOUSBIB ARI | A-Award | 796.00 | $0.00 | $0 |
| 2026-05-21 | BOUSBIB ARI | A-Award | 270.89 | $0.00 | $0 |
| 2026-05-21 | BOYD JEFFERY H | A-Award | 796.00 | $0.00 | $0 |
| 2026-05-21 | BOYD JEFFERY H | A-Award | 270.89 | $0.00 | $0 |
| 2026-05-21 | ARPEY GERARD J | A-Award | 796.00 | $0.00 | $0 |
| 2026-05-21 | Linnartz Stephanie | A-Award | 796.00 | $0.00 | $0 |
| 2026-05-21 | Linnartz Stephanie | A-Award | 191.22 | $0.00 | $0 |
Dividend History (Last 20)
Last updated: Jun 21, 2026 6:34pm (5d ago)| Date | Dividend | Declaration | Record | Payment |
|---|---|---|---|---|
| 2026-06-04 | $2.33 | 2026-05-21 | 2026-06-04 | 2026-06-18 |
| 2026-03-12 | $2.33 | 2026-02-24 | 2026-03-12 | 2026-03-26 |
| 2025-12-04 | $2.30 | 2025-11-20 | 2025-12-04 | 2025-12-18 |
| 2025-09-04 | $2.30 | 2025-08-21 | 2025-09-04 | 2025-09-18 |
| 2025-06-05 | $2.30 | 2025-05-22 | 2025-06-05 | 2025-06-18 |
| 2025-03-13 | $2.30 | 2025-02-25 | 2025-03-13 | 2025-03-27 |
| 2024-11-27 | $2.25 | 2024-11-14 | 2024-11-27 | 2024-12-12 |
| 2024-08-29 | $2.25 | 2024-08-15 | 2024-08-29 | 2024-09-12 |
| 2024-05-30 | $2.25 | 2024-05-16 | 2024-05-30 | 2024-06-13 |
| 2024-03-06 | $2.25 | 2024-02-20 | 2024-03-07 | 2024-03-21 |
| 2023-11-29 | $2.09 | 2023-11-16 | 2023-11-30 | 2023-12-14 |
| 2023-08-30 | $2.09 | 2023-08-17 | 2023-08-31 | 2023-09-14 |
| 2023-05-31 | $2.09 | 2023-05-18 | 2023-06-01 | 2023-06-15 |
| 2023-03-08 | $2.09 | 2023-02-21 | 2023-03-09 | 2023-03-23 |
| 2022-11-30 | $1.90 | 2022-11-17 | 2022-12-01 | 2022-12-15 |
| 2022-08-31 | $1.90 | 2022-08-18 | 2022-09-01 | 2022-09-15 |
| 2022-06-01 | $1.90 | 2022-05-19 | 2022-06-02 | 2022-06-16 |
| 2022-03-09 | $1.90 | 2022-02-22 | 2022-03-10 | 2022-03-24 |
| 2021-12-01 | $1.65 | 2021-11-18 | 2021-12-02 | 2021-12-16 |
| 2021-09-01 | $1.65 | 2021-08-19 | 2021-09-02 | 2021-09-16 |
Narrative Economics
market-narrative step).
Delvantic AI Findings
Looking at the raw quarterly tape first: HD's most recent quarter (May 2026) printed $41.77B revenue and $3.29B NI at 7.9% margin, versus year-ago $39.86B/$3.43B/8.6%. That's +4.8% revenue but -4.1% earnings — top-line is reaccelerating modestly while margin continues to bleed. The 8-quarter margin path (10.6 → 10.1 → 9.1 → 7.5 → 8.6 → 10.1 → 8.7 → 6.7 → 7.9) shows compression that's structural, not just seasonal — peak Q2 margins fell from 10.6% to 10.1% YoY, and the Feb-quarter trough deepened from 7.5% to 6.7%. Annual NI has walked down three years running: $17.11B → $15.14B → $14.81B → $14.16B. FCF tells the worse story: $12.65B against $16.33B operating CF, and momentum says FCF CAGR is -16.1%. That is the entire bear case in one line.
Now the balance sheet — and this is where I push back on the synthesis. The "high debt risk / interest coverage dangerously low" red flag in the valuation synthesis looks overcooked. HD generated $20.89B operating income against well-known interest expense around $2.2-2.3B annually; coverage is ~9x, not dangerous. The $1.39B cash figure is misleading because HD runs a deliberately thin cash balance and funds itself with operating cash flow + commercial paper — that's been their model for two decades. The market-forces verdict calling this a "value trap with misleading debt metrics" is directionally fine on the cycle, but the debt alarm is wrong. Separately, the 113% ROE and 29x P/B aren't quality signals — they're artifacts of HD having bought back so much stock that book equity is near zero. Standard for HD; ignore.
Where I land between the models: the synthesis DCF at $176 and the narrative engine's $176 anchor are both anchoring on trough FCF ($12.65B) as steady-state. That's the symmetric error to the bulls anchoring on 2022's $17B. Mid-cycle FCF for HD is probably $14-15B; at a defensible 22x FCF multiple (below the bull's 28x, above a cyclical-trough 18x), fair value is ~$310-330B market cap, or roughly $310-330/share. So the stock is trading near mid-cycle fair value, not 46% above it. The bear case to $176 requires believing margins permanently reset to 7%, which would imply Lowe's-like economics — and HD's per-store productivity gap versus LOW hasn't closed in 15 years. The bull case to $400+ requires the housing cycle inflecting, and quarterly data doesn't yet support that — revenue YoY is +3.2% with decelerating quarterly trend.
The contrarian argument the models are underweighting: HD's Pro/contractor mix (now ~50% of sales after the SRS Distribution acquisition) is a different business than DIY — stickier, more recurring, less rate-sensitive. If that thesis is right, the "cyclical value trap" framing is half-wrong, and you'd expect margin recovery as Pro mix scales even without a housing rebound. The insider data is useless here — all small awards and one J-Other, no meaningful selling or buying signal. Data quality is fine overall; the TTM-vs-annual flags on the ratios are noise. I dissent partially from the synthesis: HD is not 46% overvalued, but it's also not cheap. It's fairly priced for a mature cyclical at mid-cycle, with asymmetric downside if housing breaks further and limited upside until rates ease or Pro segment proves out. The 2.4% dividend yield plus ~3-4% earnings growth gets you 5-7% annualized — fine, not exciting, and you're carrying cycle risk for a non-cycle return profile. I'd want a 15-20% discount to current ($265-275) before committing capital.
GPT Critique
Home Depot's financial data presents a mixed bag. The revenue trend is positive, showing a consistent increase from $151.16B in 2022 to $164.68B in 2026. However, net income has declined in the same period, from $16.43B to $14.16B, highlighting margin compression. This is corroborated by the quarterly data, where the most recent quarter shows a revenue increase to $41.77B but a net income decrease to $3.29B, with margins dropping from highs of 10.6% to a concerning 7.9%. Free cash flow has also taken a hit, falling from $17.95B two years ago to $12.65B, which suggests operational efficiency issues or increased capital expenditures impacting cash generation.
I agree with Opus's assertion that the margin compression is structural rather than seasonal, as evidenced by the consistent year-over-year decline in both peak and trough margins. However, I diverge on the perceived debt risk flagged by the synthesis. Opus correctly notes that Home Depot's interest coverage ratio of around 9x is robust, given their operating income of $20.89B against manageable interest expenses. This supports the view that the alarm about debt is overstated, considering Home Depot's long-standing practice of maintaining a low cash balance and leveraging operating cash flow for liquidity.
Opus argues that the stock is not 46% overvalued, pegging fair value at $280-310, which I find reasonable given the mid-cycle FCF assumption of $14-15B and a 22x FCF multiple. This stands in contrast to the synthesis's $176 anchor, which I agree is overly pessimistic. However, I would temper the optimism slightly by noting that the revenue growth appears modest (+3.2% YoY), and the housing market's macro environment remains a headwind, suggesting that the upside is capped without a clear catalyst for margin or revenue acceleration.
A skeptic might argue that both Opus and I are underestimating the potential for further macroeconomic deterioration, particularly in housing, which could compress margins even further and challenge the assumption of a mid-cycle valuation. They might also point out that the Pro/contractor mix, while potentially stabilizing, may not fully insulate Home Depot from broader cyclical pressures, suggesting that the stock could still be a value trap if housing falters significantly.