HOME DEPOT, INC. (HD) Stock Analysis

Analysis from 10-Q filed 2025-11-25. Data as of Q1 2026.

Overall Grade: F (Concerning)

Grade F (Concerning). ROIC 23.1%. FCF margin 7.7%. D/E 4.0x. Source: 10-Q filed 2025-11-25.

Metric	Value	Context
ROIC	23.1%	Above industry average
FCF Margin	7.7%	Healthy cash flow
Debt/Equity	4.0x	Elevated debt

ROIC 23.1% — Top 25% of sector peers. FCF margin 7.7% — Top 25%.

Explore HOME DEPOT, INC.: Earnings History | Filings | ROIC Analysis

Programmatic access: Available via MCP at mcp.metricduck.com. Tools for HD: get_company_overview, get_filing_index (lens: debt_stress, management_outlook, risk_trajectory), get_filing_changes, get_metric_history, compare_companies, screen_filing_signals.

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Profitability: HOME DEPOT, INC. earns 23.1% ROIC, Top 25% in Consumer Discretionary

ROIC TTM 23.1%, sector median 8.1%, Top 25%. DuPont: NOPAT margin 9.7% × asset turnover 1.6x. Gross margin 33.3%. Operating margin 12.7%. Source: 10-Q filed 2025-11-25.

Metric	HD	Rating	Context
Return on Invested Capital (ROIC)	23.1%	Excellent	Above sector median of 8.1%
Return on Equity (ROE)	139.9%	Excellent	Efficient use of shareholder equity
Gross Margin	33.3%	Good	Competitive pricing environment
Operating Margin	12.7%	Good	Moderate operational efficiency

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Cash Flow: HOME DEPOT, INC. generates $12.6B FCF at 7.7% margin, positive NaN/8 quarters

FCF TTM $12.6B. FCF margin 7.7%, Top 25%. OCF/Net income 1.2x. Positive FCF in NaN/8 trailing quarters. Source: 10-Q filed 2025-11-25.

Metric	HD	Rating	Context
Free Cash Flow Margin	7.7%	Adequate	Healthy cash generation
Free Cash Flow (TTM)	$12.6B	Good	Positive cash generation
OCF/Net Income	1.2x	Excellent	High earnings quality
FCF Consistency (8Q)	N/A	Warning	Variable cash flow

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Balance Sheet: HOME DEPOT, INC. at 4.0x leverage

Debt/Equity 4.0x. Total debt $50.8B, cash & investments $1.4B. Source: 10-Q filed 2025-11-25.

Metric	HD	Rating	Context
Debt to Equity	4.0x	Red flag	Elevated leverage
Net Cash Position	$-49.4B	Warning	Net debt position

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Valuation: HOME DEPOT, INC. trades at 26.3x earnings

P/E 26.3x. EV/Sales 2.5x. FCF yield 3.4%. Dividend yield 2.5%. Source: 10-Q filed 2025-11-25.

Metric	HD	Rating	Context
P/E Ratio	26.3x	Adequate	Premium valuation
EV/Sales	2.5x	Good	Attractive revenue multiple
FCF Yield	3.4%	Adequate	Lower cash yield
Dividend Yield	2.5%	Adequate	Growth focus over income

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Capital Allocation: HOME DEPOT, INC. returns 2.5% shareholder yield

Total shareholder yield 2.5% (div 2.5%). Capital returned $9.2B TTM. Source: 10-Q filed 2025-11-25.

Metric	HD	Rating	Context
Total Shareholder Yield	2.5%	Adequate	Dividend + buyback yield combined
Buyback Yield	0.0%	Adequate	Minimal buyback activity
Total Capital Returned (TTM)	$9.2B	Good	Dividends + buybacks returned to shareholders

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Sector Rankings

Metric	Value	Percentile	vs Median
Return on Invested Capital (ROIC)	23.1%	Top 25%	2.9x above
Free Cash Flow Margin	7.7%	Top 25%	3.5x above
Gross Margin	33.3%	Bottom 50%	0.9x below
Operating Margin	12.7%	Top 25%	3.0x above
Return on Equity (ROE)	139.9%	Top 5%	13.6x above
P/E Ratio	26.3x	N/A	-

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Financial Scorecard

Metric	HD	Rating	Sector Context
Return on Invested Capital (ROIC)	23.1%	Excellent	Top 25% of sector (median: 8.1%)
Free Cash Flow Margin	7.7%	Adequate	Top 25% of sector (median: 2.2%)
Gross Margin	33.3%	Good	Bottom 50% of sector (median: 39.1%)
Debt to Equity Ratio	396.5%	Red flag	High financial leverage
P/E Ratio (Price-to-Earnings)	26.3x	Adequate	Growth premium
Free Cash Flow Yield	3.4%	Adequate	Moderate yield

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Frequently Asked Questions

Q: What is HOME DEPOT, INC.'s Return on Invested Capital (ROIC)?

HOME DEPOT, INC. (HD) has a trailing twelve-month Return on Invested Capital (ROIC) of 23.1%. Sector median 8.1%. Source: 10-Q filed 2025-11-25.

Q: What is HOME DEPOT, INC.'s Free Cash Flow Margin?

HOME DEPOT, INC. (HD) has a free cash flow margin of 7.7%, generating $12.6 billion in free cash flow over the trailing twelve months. Source: 10-Q filed 2025-11-25.

Q: What is HOME DEPOT, INC.'s P/E ratio and how does it compare to peers?

HOME DEPOT, INC. (HD) trades at a P/E ratio of 26.3x, which is above the sector median of N/A. EV/Sales 2.5x. FCF yield 3.4%. Source: 10-Q filed 2025-11-25.

Q: Does HOME DEPOT, INC. pay a dividend?

HOME DEPOT, INC. (HD) currently pays a dividend yield of 2.5%. Total shareholder yield (dividend + buybacks) 2.5%. Source: 10-Q filed 2025-11-25.

Q: How much debt does HOME DEPOT, INC. have?

HOME DEPOT, INC. (HD) has a debt-to-equity ratio of 4.0x with total debt of $50.8 billion. Net debt $49.4 billion. Source: 10-Q filed 2025-11-25.

Q: What is HOME DEPOT, INC.'s revenue and earnings growth?

HOME DEPOT, INC. (HD) grew revenue by 3.2% year-over-year. EPS -4.6% YoY. Source: 10-Q filed 2025-11-25.

Q: How does HOME DEPOT, INC. compare to competitors in Consumer Discretionary?

Compared to other companies in Consumer Discretionary, HOME DEPOT, INC. (HD) shows: ROIC 23.1%, sector median 8.1% (Top 25%). FCF margin 7.7%, sector median 2.2% (Top 25%). Gross margin 33.3%, 5.8pp below sector median. These rankings are based on MetricDuck's analysis of all Consumer Discretionary companies with available SEC filings.

Q: What warning signs should I watch for with HOME DEPOT, INC.?

Quantitative warning flags for HOME DEPOT, INC. (HD): 1) ROIC declining -10.4% over 8 quarters; 2) debt/equity 4.0x (above 1.5x threshold). Source: 10-Q filed 2025-11-25.

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Data Source: Data sourced from 10-Q filed 2025-11-25. TTM metrics as of Q1 2026.

Methodology: Financial metrics calculated from SEC 10-K and 10-Q filings using standardized formulas. Sector comparisons use peer group based on SIC code.

Scope: This analysis covers SEC filing fundamentals — profitability, cash flow, balance sheet, and valuation metrics. For analyst estimates and price targets, consult sell-side research.

This analysis is for informational purposes only and does not constitute investment advice.