HD
CyclicalHome Depot (The)
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Market Data
Financials
XBRL · SEC EDGAR2008–2025(18yr)| Metric | FY 2008 | FY 2009 | FY 2010 | FY 2011 | FY 2012 | FY 2013 | FY 2014 | FY 2015 | FY 2016 | FY 2017 | FY 2018 | FY 2019 | FY 2020 | FY 2021 | FY 2022 | FY 2023 | FY 2024 | FY 2025Latest | YoY |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue | $77.3B | $71.3B | $66.2B | $68.0B | $70.4B | $74.8B | $78.8B | $83.2B | $88.5B | $94.6B | $100.9B | $108.2B | $110.2B | $132.1B | $151.2B | $157.4B | $152.7B | $159.5B | +4.5% |
| Gross Profit | $26.0B | $24.0B | $22.4B | $23.3B | $24.3B | $25.8B | $27.4B | $29.0B | $30.3B | $32.3B | $34.4B | $37.2B | $37.6B | $44.9B | $50.8B | $52.8B | $51.0B | $53.3B | +4.6% |
| Gross Margin | 33.6% | 33.7% | 33.9% | 34.3% | 34.5% | 34.6% | 34.8% | 34.8% | 34.2% | 34.2% | 34.0% | 34.3% | 34.1% | 34.0% | 33.6% | 33.5% | 33.4% | 33.4% | +0.0pp |
| Operating Income | $7.2B | $4.4B | $4.8B | $5.8B | $6.7B | $7.8B | $9.2B | $10.5B | $11.8B | $13.4B | $14.7B | $15.5B | $15.8B | $18.3B | $23.0B | $24.0B | $21.7B | $21.5B | -0.8% |
| Operating Margin | 9.4% | 6.1% | 7.3% | 8.6% | 9.5% | 10.4% | 11.6% | 12.6% | 13.3% | 14.2% | 14.5% | 14.4% | 14.4% | 13.8% | 15.2% | 15.3% | 14.2% | 13.5% | -0.7pp |
| Net Income | $4.4B | $2.3B | $2.7B | $3.3B | $3.9B | $4.5B | $5.4B | $6.3B | $7.0B | $8.0B | $8.6B | $11.1B | $11.2B | $12.9B | $16.4B | $17.1B | $15.1B | $14.8B | -2.2% |
| Net Margin | 5.7% | 3.2% | 4.0% | 4.9% | 5.5% | 6.1% | 6.8% | 7.6% | 7.9% | 8.4% | 8.6% | 10.3% | 10.2% | 9.7% | 10.9% | 10.9% | 9.9% | 9.3% | -0.6pp |
| Free Cash Flow | $2.2B | $3.7B | $4.2B | $3.5B | $5.4B | $5.7B | $6.2B | $6.8B | $7.9B | $8.2B | $10.1B | $10.6B | $11.0B | $16.4B | $14.0B | $11.5B | $17.9B | $16.3B | -9.0% |
| FCF Margin | 2.8% | 5.2% | 6.3% | 5.1% | 7.7% | 7.6% | 7.9% | 8.2% | 8.9% | 8.6% | 10.0% | 9.8% | 10.0% | 12.4% | 9.3% | 7.3% | 11.8% | 10.2% | -1.5pp |
| EPS (Diluted) | $2.37 | $1.34 | $1.57 | $2.01 | $2.47 | $3.00 | $3.76 | $4.71 | $5.46 | $6.45 | $7.29 | $9.73 | $10.25 | $11.94 | $15.53 | $16.69 | $15.11 | $14.91 | -1.3% |
1. THE BIG PICTURE
Home Depot is currently transitioning its business model to capture a larger share of the professional contractor market while defending its retail dominance through an "interconnected" digital-physical ecosystem. By acquiring SRS and expanding Pro-focused loyalty programs, Home Depot (The) is attempting to outgrow a cooling DIY market that remains pressured by high interest rates and housing uncertainty.
2. WHERE THE RISKS HIT HARDEST
The Interconnected Shopping Experience (Business) is directly threatened by Cybersecurity and Data Privacy risks because the frictionless journey relies on digital platforms like homedepot.com and Pro Xtra. A breach in these systems would not only incur significant remediation costs but also dismantle the "intangible" competitive advantage of customer trust (Risks).
Furthermore, Home Depot’s Supply Chain Network—which management considers a structural advantage—is vulnerable to Macroeconomic Sensitivity (Competitive Position). Because Home Depot (The) maintains a massive network of specialized distribution centers, a sustained dip in demand caused by high interest rates makes these fixed costs harder to absorb. This was evident in the fourth quarter of fiscal 2025, where net sales fell 3.8% to $38.2 billion as consumer uncertainty persisted (8-K).
3. WHAT THE NUMBERS SAY TOGETHER
While the most recent quarterly sales fell, the decline was largely a calendar artifact; the fourth quarter of fiscal 2025 had 13 weeks compared to 14 weeks in the prior year, a shift that accounted for $2.5 billion in sales (8-K). Adjusting for this, underlying demand appears more stable than the headline suggests.
Home Depot’s 13.5% operating margin is the second-highest in its peer group, yet its 8.3% FCFFCFFree Cash Flow — cash left after paying for operations and capital investments; what the company can actually spend, save, or return to shareholders margin sits in the middle of the pack (Peer Benchmarking). This discrepancy reveals that while Home Depot (The) is highly efficient at generating operating profit, its heavy capital commitments—including the SRS acquisition and "interconnected" infrastructure—consume a larger portion of cash than leaner peers like O'Reilly. Short interest remains low at 1.0% of the float, suggesting that the market generally accepts management’s narrative of stability despite the recent sales contraction (Supplemental Signals).
4. IS IT WORTH IT AT THIS PRICE?
At 22.0x Forward P/EP/EPrice-to-Earnings ratio — share price divided by annual earnings per share; how much investors pay per dollar of profit. Higher P/E = higher growth expectations, Home Depot trades at a modest discount to the peer median of 26.4x (Peer Benchmarking). The market is currently pricing in ~5.7% long-term growth (CAPM analysis). This implied rate is slightly higher than the TTMTTMTrailing Twelve Months — the most recent full year of financial data, updated on a rolling basis each quarter revenue growth of +4.5%, but it is supported by management’s fiscal 2026 guidance, which forecasts total sales growth of up to 4.5% (8-K).
The current valuation appears to be in line with Home Depot (The)'s fundamentals. However, the sensitivity data suggests the price is highly dependent on maintaining this growth; if long-term growth were to slow to a GDP-pace of 2.5%, the justified multiple would fall to 12.9x (CAPM analysis). The primary risk that could trigger such a re-rating is "competitive fragmentation," where the rise of online-only retailers and price transparency erodes the margins that currently support Home Depot's premium valuation.
5. WHAT WOULD CHANGE THIS VIEW?
- Constructive if comparable sales growth exceeds the "flat to 2.0%" guidance for fiscal 2026, proving that Pro-focused initiatives and the SRS integration are successfully capturing market share despite high interest rates.
- Cautious if operating margins fall below the 12.4% floor of management's guidance, indicating that the costs of the interconnected retail strategy are outstripping the efficiency gains from tools like Computer Vision and Sidekick.
6. BOTTOM LINE
Structural Advantage: A massive, specialized supply chain network integrated with a premium physical store footprint that creates high switching costs for professional contractors and a frictionless experience for consumers.
Bottom Line: Home Depot is a highly efficient incumbent whose current valuation accurately reflects its steady growth prospects and significant macroeconomic exposure.
1. Top 5 Material Risks
- Competitive Pressure: Home Depot (The) faces intense competition from a wide array of retailers, including brick-and-mortar stores, online-only retailers, and specialty distributors. Failure to respond to aggressive promotional pricing or liquidation events could adversely affect prices, margins, and demand.
- Interconnected Retail Strategy Execution: Home Depot (The)’s reliance on significant investments in supply chain, store base, and information technology creates risks of cost overruns, implementation delays, and operational complexity. These initiatives may not yield the anticipated benefits or could disrupt current operations.
- Cybersecurity and Data Privacy: Home Depot (The) is vulnerable to cyber-attacks, data breaches, and system outages. Such incidents could result in significant costs for investigation and remediation, regulatory fines, and loss of customer trust.
- Supply Chain Disruptions: Logistics and supply chain network failures—caused by factors such as natural disasters, labor shortages, or geopolitical conflicts—can impair Home Depot (The)’s ability to receive and deliver inventory, leading to lost sales and increased costs.
- Customer Needs and Trends: The inability to timely identify or respond to shifting customer preferences, demographics, and expectations regarding personalized experiences and delivery options could reduce market share and store traffic.
2. Company-Specific Risks
- Proprietary Product Strategy: As Home Depot (The) expands its proprietary product offerings, it assumes greater responsibility for design, manufacture, and marketing, increasing exposure to product liability, recall costs, and intellectual property disputes.
- Installation Services Liability: Acting as a general contractor for DIFM (Do-It-For-Me) customers through third-party installers exposes Home Depot (The) to regulatory enforcement actions, property damage claims, and the potential loss of general contractor licenses.
- Shrinkage: Heightened levels of inventory loss, particularly due to organized retail crime, require operational changes that increase costs and reduce margins.
- Pro Customer Credit Risk: The expansion of the Pro House Account trade credit program increases Home Depot (The)’s exposure to default risk if Pro customers are unable to repay their obligations.
3. Regulatory/Legal Risks
- Environmental and Sourcing Compliance: Home Depot (The) faces risks related to responsible sourcing standards, including potential litigation or enforcement actions regarding timber, minerals, and PFAS (perfluoroalkyl and polyfluoroalkyl substances).
- Consumer Protection Laws: Increased regulatory focus on pricing, discounting, and advertising practices may lead to higher general and administrative expenses and potential litigation.
- Data Privacy Regulations: Compliance with evolving state and international privacy laws requires significant effort and cost, with failure to comply potentially resulting in fines and sanctions.
- Labor and Employment Regulations: Changes in laws governing minimum wage, employee classification, and healthcare benefits could increase labor costs and impact operational flexibility.
4. Financial Impact Map
Competitive Pressure → Profit Margins → Aggressive promotional pricing or liquidation events by competitors could force price adjustments that compress margins. Interconnected Retail Strategy Execution → Operating Expenses → Costs associated with implementing new technologies, artificial intelligence, and supply chain real estate projects could increase overhead. Cybersecurity and Data Privacy → General and Administrative Expenses → Significant resources required to mitigate breaches, including investigation, remediation, and potential legal settlements. Supply Chain Disruptions → Cost of Goods Sold → Increased transportation costs and the need to source from more expensive alternative suppliers during logistics failures. Pro Customer Credit Risk → Cash Flow → Defaults on trade credit by Pro customers could reduce cash inflows and necessitate higher loss provisions.
Recent Filings
| Form | Filed | Period |
|---|---|---|
| 8-K | Feb 2026 | — |
| 10-Q | Nov 2025 | Nov 2025 |
| 14A | Apr 2025 | — |
| 10-K | Mar 2025 | Feb 2025 |
AI-extracted key facts from press releases and SEC filings. Significance 1–10.
BofA reinstates Home Depot at Buy with $374 price target
- ▸Bank of America reinstates coverage with Buy rating
- ▸Price target set at $374 per share
- ▸Named top pick in home improvement sector
- ▸Expects comparable sales to outperform industry peers
- ▸Growth driven by Pro customer penetration and traffic trends
Home Depot acquires Mingledorff's to expand into $100B HVAC distribution market
- ▸Acquired HVAC distributor Mingledorff's to enter professional HVAC market
- ▸Expands footprint across Southeastern U.S. distribution network
- ▸Targets $100B addressable HVAC market beyond core retail
- ▸Mingledorff's existing leadership team to remain in place
- ▸Transaction expected to have minimal impact on company leverage
Home Depot subsidiary SRS Distribution to acquire HVAC distributor Mingledorff’s in Q2
- ▸SRS Distribution to acquire Mingledorff’s, an HVAC distributor with 42 locations
- ▸Deal expands total addressable market by $100B in HVAC distribution sector
- ▸Transaction expected to close in Q2, funded via cash and debt
- ▸Mingledorff’s leadership team to remain in place post-acquisition
- ▸Jefferies reiterates Buy rating citing long-term earnings power from distribution consolidation
Home Depot acquires Mingledorff's, expanding addressable market by $100 billion
- ▸Acquired Mingledorff's to expand HVAC distribution vertical
- ▸Combined TAM with SRS Distribution projected to increase by $100 billion
- ▸Jefferies maintains 'Buy' rating citing long-term earnings power
- ▸BNP Paribas trims price target to $348 from $391
- ▸BNP Paribas lowers valuation multiple to 17.5x EV/EBIT from 19.5x
SKYX Q4 revenue $25M, FY2025 revenue $92M +7% YoY, announces NVIDIA AI collaboration
- ▸Q4 revenue $25M, marking 8 consecutive quarters of YoY growth
- ▸FY2025 revenue $92M vs $86M in 2024
- ▸FY2025 gross profit $28M, up 13% YoY
- ▸Operating cash burn reduced by $5M (27%) to $13M in 2025
- ▸Announced collaboration with NVIDIA AI ecosystem for smart home projects
Home Depot to Acquire Mingledorff's, Expanding Into $100B HVAC Distribution Market
- ▸Acquiring HVAC distributor Mingledorff's via subsidiary SRS Distribution
- ▸Mingledorff's operates 42 locations across five southeastern U.S. states
- ▸Transaction expands Home Depot's total addressable market to $1.2 trillion
- ▸Deal expected to close in second quarter of fiscal 2026
- ▸Mingledorff's to operate under current leadership within SRS organization
Home Depot acquisition of Mingledorff’s expands addressable market by $100B, Jefferies says
- ▸Acquisition of Mingledorff’s expands Home Depot and SRS Distribution TAM by $100B
- ▸Deal provides foundation for growth in HVAC distribution vertical
- ▸Jefferies reiterates Buy rating on Home Depot shares
- ▸Consolidation strategy expected to support long-term earnings power
Dow Jones Rises Following Trump Iran Comments; Cathie Wood Buys IPO Stock
- ▸Dow Jones Industrial Average gains following President Trump's remarks on Iran
- ▸Cathie Wood's ARK Invest adds position in recent IPO stock
- ▸IPO stock shows 84% decline from initial offering levels