Home Depot (HD)
NYSE:HD
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Home Depot
(NYSE:HD)
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Rating:65Neutral
Price Target:
$354.00
▲(1.32% Upside)
Action:ReiteratedDate:02/25/26
The score is driven primarily by solid but weakening financial performance—strong profitability/cash flow tempered by slowing/negative growth, margin pressure, and elevated leverage. Technicals are supportive with a positive trend above major moving averages, while valuation looks somewhat premium despite a decent dividend. Earnings call guidance suggests modest recovery, but near-term EPS and margin headwinds limit upside.
Positive Factors
Free cash flow generation
Consistent TTM free cash flow of roughly $12.6B provides durable internal funding for dividends, buybacks, store/SRS expansion, and digital investments. Strong FCF cushions the business through cyclical soft patches and underpins long-term capital allocation flexibility.
Negative Factors
Elevated leverage and thin equity
High leverage and a thin, volatile equity base reduce financial flexibility and increase sensitivity to rising rates or earnings shocks. This structural capital-structure risk can constrain strategic moves, increase interest burden, and amplify downside in prolonged industry weakness.
Read all positive and negative factors
Positive Factors
Negative Factors
Free cash flow generation
Consistent TTM free cash flow of roughly $12.6B provides durable internal funding for dividends, buybacks, store/SRS expansion, and digital investments. Strong FCF cushions the business through cyclical soft patches and underpins long-term capital allocation flexibility.
Read all positive factors
Home Depot (HD) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$321.53B
Dividend Yield2.67%
Average Volume (3M)3.86M
Price to Earnings (P/E)26.5
Beta (1Y)0.80
Revenue Growth3.24%
EPS Growth-4.61%
CountryUS
Employees470,100
SectorConsumer Cyclical
Sector Strength84
IndustryHome Improvement
Share Statistics
EPS (TTM)2.72
Shares Outstanding996,027,650
10 Day Avg. Volume3,570,512
30 Day Avg. Volume3,859,576
Financial Highlights & Ratios
PEG Ratio-5.75
Price to Book (P/B)29.30
Price to Sales (P/S)2.28
P/FCF Ratio29.69
Enterprise Value/Market Cap1.20
Enterprise Value/Revenue2.34
Enterprise Value/Gross Profit7.03
Enterprise Value/Ebitda15.87
Forecast
1Y Price Target
$425.06Price Target Upside21.65% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering20
EPS Forecast (FY)15.03
Revenue Forecast (FY)$171.29B
Home Depot Business Overview & Revenue Model
Company Description
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, as well as facilities maintenance, repai...
How the Company Makes Money
Home Depot primarily makes money by selling home improvement products and related services, with revenue recognized largely at the point of sale through its retail stores and digital channels. Its key revenue stream is merchandise sales across maj...
Home Depot Key Performance Indicators (KPIs)
Any
Revenue by Geography
Breaks down revenue across different regions, revealing where Home Depot is strongest and where it may face risk or growth potential due to local economic conditions or market share shifts.
Breaks down revenue across different regions, revealing where Home Depot is strongest and where it may face risk or growth potential due to local economic conditions or market share shifts.
Data provided by:
The Fly
The FlyHome Depot Earnings Call Summary
Earnings Call Date:Feb 24, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 19, 2026
Earnings Call Sentiment Neutral
The call presented a mix of positive operational momentum and near-term financial headwinds. Positives include 3.2% annual revenue growth to $164.7B, stable positive comparable sales, strong digital performance (+~11% online comp sales in Q4), Pro and SRS share gains, record promotional event performance, continued investment in stores and Pro capabilities, and an increased dividend. Offsetting these are margin compression, higher operating expenses as a percent of sales, declines in adjusted EPS (Q4 down ~13% adjusted; FY down ~3.6% adjusted), inventory build and lower turns, and persistent macro pressures (housing affordability, low turnover, and a weak roofing market with shipments down ~28% in Q4). The company provided FY26 guidance calling for modest sales and EPS growth (total sales +2.5% to +4.5%, comps flat to +2%, adjusted EPS flat to +4%) while noting first-half margin impacts from acquisition annualization. Overall, the results show solid strategic progress (digital, Pro, acquisitions) but also notable near-term profitability and macro headwinds that balance the positives.Positive Updates
Annual Revenue Growth
Fiscal 2025 sales of $164.7 billion, up 3.2% versus fiscal 2024, demonstrating top-line growth despite industry headwinds.
Negative Updates
Earnings Per Share Declines
Adjusted diluted EPS for fiscal 2025 was $14.69, down 3.6% versus fiscal 2024; adjusted diluted EPS for Q4 was $2.72, down 13.1% year-over-year. GAAP diluted EPS for the year was $14.23, down 4.6%.
Read all updates
Q4-2025 Updates
Positive
Negative
Annual Revenue Growth
Fiscal 2025 sales of $164.7 billion, up 3.2% versus fiscal 2024, demonstrating top-line growth despite industry headwinds.
Read all positive updates
Company Guidance
Home Depot affirmed fiscal 2026 guidance calling for total sales growth of approximately 2.5%–4.5% and comparable sales flat to +2%, with diluted and adjusted diluted EPS each expected to increase approximately flat to +4%; full-year gross margin ~33.1% (about a 24 bps headwind YoY from GMS annualization), operating margin ~12.4%–12.6% and adjusted operating margin ~12.8%–13%, an effective tax rate of ~24.3% and net interest expense of ~$2.3B. They expect SRS organic sales to grow mid-single-digits, plan to open ~15 new Home Depot stores and 40–50 new SRS locations, and target capital expenditures of roughly 2.5% of sales; they also said first-half comps should be slightly below the second half, Q1 EPS to be mid-single-digit percent negative year-over-year due to acquisition annualization and timing, and first-half gross margin to be down ~50 bps versus last year (with second-half roughly flat).Home Depot Financial Statement Overview
Summary
Income Statement
74
Positive
Balance Sheet
48
Neutral
Cash Flow
66
Positive
| Breakdown | Jan 2026 | Jan 2025 | Jan 2024 | Jan 2023 | Jan 2022 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 164.68B | 159.51B | 152.67B | 157.40B | 151.16B |
| Gross Profit | 54.87B | 53.31B | 50.96B | 52.78B | 50.83B |
| EBITDA | 24.29B | 25.43B | 25.11B | 27.07B | 25.95B |
| Net Income | 14.16B | 14.81B | 15.14B | 17.11B | 16.43B |
Balance Sheet | |||||
| Total Assets | 105.09B | 96.12B | 76.53B | 76.44B | 71.88B |
| Cash, Cash Equivalents and Short-Term Investments | 1.39B | 1.66B | 3.76B | 2.76B | 2.34B |
| Total Debt | 65.35B | 62.29B | 52.24B | 50.36B | 46.27B |
| Total Liabilities | 92.28B | 89.48B | 75.49B | 74.88B | 73.57B |
| Stockholders Equity | 12.81B | 6.64B | 1.04B | 1.56B | -1.70B |
Cash Flow | |||||
| Free Cash Flow | 12.65B | 16.32B | 17.95B | 11.50B | 14.01B |
| Operating Cash Flow | 16.32B | 19.81B | 21.17B | 14.62B | 16.57B |
| Investing Cash Flow | -8.98B | -21.03B | -4.73B | -3.14B | -2.97B |
| Financing Cash Flow | -7.71B | -694.00M | -15.44B | -10.99B | -19.12B |
Home Depot Technical Analysis
Neutral
349.40
Price Trends
352.32
Negative
355.25
Negative
368.42
Negative
Market Momentum
-1.44
Negative
57.37
Neutral
86.13
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HD, the sentiment is Neutral. The current price of 349.4 is above the 20-day moving average (MA) of 331.83, below the 50-day MA of 352.32, and below the 200-day MA of 368.42, indicating a neutral trend. The MACD of -1.44 indicates Negative momentum. The RSI at 57.37 is Neutral, neither overbought nor oversold. The STOCH value of 86.13 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for HD.
Home Depot Risk Analysis
Home Depot disclosed 25 risk factors in its most recent earnings report. Home Depot reported the most risks in the "Production" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Home Depot Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
72 Outperform | $443.06B | 55.55 | 28.81% | 0.59% | 8.40% | 12.18% | |
65 Neutral | $321.53B | 26.52 | 130.02% | 2.67% | 3.24% | -4.61% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
60 Neutral | $18.29B | 35.89 | 42.57% | 1.80% | 4.64% | 1.15% | |
58 Neutral | $12.28B | 12.85 | 38.54% | 5.46% | 0.39% | 17.90% | |
58 Neutral | $130.77B | 22.44 | -59.21% | 1.94% | 3.12% | -3.03% | |
56 Neutral | $5.15B | 43.30 | 8.99% | ― | 5.12% | 0.82% |
* Consumer Cyclical Sector Average
HD
Home Depot
322.81
-28.79
-8.19%
BBY
Best Buy Co
58.73
-4.40
-6.97%
COST
Costco
998.67
9.59
0.97%
LOW
Lowe's
233.50
14.25
6.50%
TSCO
Tractor Supply
34.77
-14.99
-30.12%
FND
Floor & Decor Holdings
47.67
-23.77
-33.27%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.