Is Home Depot Stock a Good Investment?
Home Depot Investment Advice | HD |
- Examine Home Depot's financial health by looking at its balance sheet, income statement, and cash flow statement. Analyze key financial ratios, such as Price-to-Earnings (P/E), Price-to-Sales (P/S), and Price-to-Book (P/B), to determine whether the stock is fairly valued or over/undervalued.
- Research Home Depot's leadership team and their track record. Good management can help Home Depot navigate difficult times and make strategic decisions that benefit shareholders and increases its net worth.
- Consider the overall health of the Home Improvement Retail space and any emerging trends that could impact Home Depot's business and its evolving consumer preferences.
- Compare Home Depot's performance and market position to its competitors. Analyze how Home Depot is positioned in terms of product offerings, innovation, and market share.
- Check if Home Depot pays a dividend and its dividend yield and payout ratio.
- Review what financial analysts are saying about Home Depot's stock and their price targets. However, remember that analysts' opinions can vary, and their predictions may not always be accurate.
It's important to note that investing in Home Depot stock, carries risks, and you should carefully consider your investment goals and risk tolerance before making any investment decisions. Also, remember that it's important for investors to have a long-term perspective and a well-diversified portfolio to manage the impact of stock market volatility on their investments. Below is a detailed guide on how to decide if Home Depot is a good investment.
Sell | Buy |
Strong Hold
Market Performance | Good | Details | |
Volatility | Very steady | Details | |
Hype Condition | Low key | Details | |
Current Valuation | Overvalued | Details | |
Odds Of Distress | Low | Details | |
Economic Sensitivity | Almost mirrors the market | Details | |
Investor Sentiment | Impartial | Details | |
Analyst Consensus | Buy | Details | |
Financial Strenth (F Score) | Poor | Details | |
Financial Leverage | Not Rated | Details | |
Reporting Quality (M-Score) | Possible Manipulator | Details |
Examine Home Depot Stock
Researching Home Depot's stock involves analyzing various aspects of the company and its industry to make an informed investment decision. The key areas to focus on are fundamentals, business model and competitive advantage. It is also important to analyze trends in revenue, net income, and cash flow, as well as key financial ratios, such as price-to-earnings (P/E), price-to-sales (P/S), and debt-to-equity (D/E). About 72.0% of the company shares are owned by institutional investors. The company has Price/Earnings To Growth (PEG) ratio of 2.27. Home Depot recorded earning per share (EPS) of 14.89. The entity last dividend was issued on the 29th of August 2024. The firm had 3:2 split on the 31st of December 1999.
To determine if Home Depot is a good investment, evaluating the company's potential for future growth is also very important. This may include expanding into new markets, launching new products or services, or improving operational efficiency. Companies with strong growth prospects can be more attractive investments. This aspect of the research should be conducted in the context of the overall market and industry in which the company operates and should include an analysis of growth potential, competitive landscape, and any regulatory or economic factors that could impact the business. Some of the essential points regarding Home Depot's research are outlined below:
| Home Depot has a poor financial position based on the latest SEC disclosures | |
| About 72.0% of the company shares are owned by institutional investors | |
| Latest headline from investing.com: U.S. stocks mixed at close of trade Dow Jones Industrial Average up 0.59 |
Home Depot Quarterly Liabilities And Stockholders Equity |
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Home Depot uses earnings reports to provide investors with an update of all three financial statements, including the income statement, the balance sheet, and the cash flow statement. Therefore, it is also crucial when considering investing in Home Depot. Every quarterly earnings report provides investors with an overview of sales, expenses, and net income for the most recent period. It also may provide a comparison to Home Depot's previous reporting period. The quarterly earnings reports are usually disseminated to the public via Form 10-Q, which is a legal document filed with the Securities and Exchange Commission every quarter.
| 20th of February 2024 Upcoming Quarterly Report | View | |
| 21st of May 2024 Next Financial Report | View | |
| 31st of January 2024 Next Fiscal Quarter End | View | |
| 20th of February 2024 Next Fiscal Year End | View | |
| 31st of October 2023 Last Quarter Report | View | |
| 31st of January 2023 Last Financial Announcement | View |
Earnings surprises can significantly impact Home Depot's stock price both in the short term and over time. Negative earnings surprises usually result in a price decline. However, it has been seen that positive earnings surprises lead to an immediate rise in a stock's price and a gradual increase over time. This is why we often hear news about some companies beating earning projections. Financial analysts spend a large amount of time predicting earnings per share (EPS) along with other important future indicators. Many analysts use forecasting models, management guidance, and additional fundamental information to derive an EPS estimate. Below are the table of largest EPS Surprises Home Depot's investors have experienced.
| Reported | Fiscal Date | Estimated EPS | Reported EPS | Surprise | |||
|---|---|---|---|---|---|---|---|
1999-02-23 | 1999-01-31 | 0.17 | 0.19 | 0.02 | 11 | ||
2003-02-25 | 2003-01-31 | 0.27 | 0.3 | 0.03 | 11 | ||
1999-05-18 | 1999-04-30 | 0.19 | 0.22 | 0.03 | 15 | ||
2009-02-24 | 2009-01-31 | 0.15 | 0.19 | 0.04 | 26 | ||
2008-05-20 | 2008-04-30 | 0.37 | 0.41 | 0.04 | 10 | ||
2011-02-22 | 2011-01-31 | 0.31 | 0.36 | 0.05 | 16 | ||
2010-05-18 | 2010-04-30 | 0.4 | 0.45 | 0.05 | 12 | ||
2009-11-17 | 2009-10-31 | 0.36 | 0.41 | 0.05 | 13 |
Know Home Depot's Top Institutional Investors
Have you ever been surprised when a price of an equity instrument such as Home Depot is soaring high without any particular reason? This is usually happening because many institutional investors are aggressively trading Home Depot backward and forwards among themselves. Home Depot's institutional investor refers to the entity that pools money to purchase Home Depot's securities or originate loans. Institutional investors include commercial and private banks, credit unions, insurance companies, pension funds, hedge funds, endowments, and mutual funds. Operating companies that invest excess capital in these types of assets may also be included in the term and may influence corporate governance by exercising voting rights in their investments.
| Shares | Wellington Management Company Llp | 2024-06-30 | 9.9 M | Royal Bank Of Canada | 2024-03-31 | 9.8 M | Fisher Asset Management, Llc | 2024-06-30 | 9.2 M | Bank Of New York Mellon Corp | 2024-06-30 | 8.7 M | Legal & General Group Plc | 2024-06-30 | 8.5 M | Jpmorgan Chase & Co | 2024-03-31 | 8.4 M | Fmr Inc | 2024-03-31 | 8.1 M | T. Rowe Price Associates, Inc. | 2024-06-30 | 6.4 M | Ubs Group Ag | 2024-03-31 | 6.1 M | Vanguard Group Inc | 2024-06-30 | 94.1 M | Blackrock Inc | 2024-06-30 | 71.1 M |
Home Depot's market capitalization trends
The company currently falls under 'Mega-Cap' category with a market capitalization of 366.03 B.Market Cap |
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Home Depot's profitablity analysis
| Last Reported | Projected for Next Year | ||
| Return On Tangible Assets | 0.23 | 0.20 | |
| Return On Capital Employed | 0.40 | 0.39 | |
| Return On Assets | 0.20 | 0.18 | |
| Return On Equity | 14.50 | 3.90 |
Determining Home Depot's profitability involves analyzing its financial statements and using various financial metrics to determine if Home Depot is a good buy. For example, gross profit margin measures Home Depot's profitability after accounting for the cost of goods sold, while net profit margin measures profitability after accounting for all expenses. Other important metrics include return on assets, return on equity, and free cash flow. By reviewing multiple sources and metrics, you can gain a complete picture of Home Depot's profitability and make more informed investment decisions.
Home Depot's Earnings Breakdown by Geography
Please note, the presentation of Home Depot's financial position, as portrayed in its financial statements, is often influenced by management's estimates, judgments, and sometimes even manipulations. In the best case, Home Depot's management is honest, while the outside auditors are strict and uncompromising. Please utilize our Beneish M Score to check the likelihood of Home Depot's management manipulating its earnings.
Evaluate Home Depot's management efficiency
Home Depot has Return on Asset (ROA) of 0.1527 % which means that for every $100 of assets, it generated a profit of $0.1527. This is way below average. Likewise, it shows a return on total equity (ROE) of 0.5134 %, which means that it produced $0.5134 on every 100 dollars invested by current stockholders. Home Depot's management efficiency ratios could be used to measure how well Home Depot manages its routine affairs as well as how well it operates its assets and liabilities. As of August 31, 2024, Return On Tangible Assets is expected to decline to 0.20. In addition to that, Return On Capital Employed is expected to decline to 0.39. At present, Home Depot's Non Current Assets Total are projected to increase significantly based on the last few years of reporting. The current year's Other Current Assets is expected to grow to about 1.8 B, whereas Net Tangible Assets are projected to grow to (5 B).| Last Reported | Projected for Next Year | ||
| Book Value Per Share | 1.05 | 3.07 | |
| Tangible Book Value Per Share | (11.03) | (6.93) | |
| Enterprise Value Over EBITDA | 16.19 | 15.62 | |
| Price Book Value Ratio | 340.37 | 87.92 | |
| Enterprise Value Multiple | 16.19 | 15.62 | |
| Price Fair Value | 340.37 | 87.92 | |
| Enterprise Value | 79.8 B | 83.8 B |
The analysis of Home Depot's management efficiency is an essential part of evaluating and assessing the financial and operational performance of the entity. It is also vital to analyze Home Depot's future growth prospects and the overall market conditions to determine the value and potential of its stock. The analysis involves studying a range of financial metrics such as revenue, earnings, profit margins, cash flow, debt, market share, and external factors such as economic trends, industry outlook, competition, and government regulations. The goal of Home Stock analysis is to determine whether it is undervalued, fairly valued, or overvalued and to make informed investment decisions.
Dividend Yield 0.0244 | Forward Dividend Yield 0.0244 | Forward Dividend Rate 9 | Beta 0.988 |
Basic technical analysis of Home Stock
As of the 31st of August, Home Depot retains the Market Risk Adjusted Performance of 0.1935, risk adjusted performance of 0.1206, and Downside Deviation of 1.54. Home Depot technical analysis makes it possible for you to employ historical prices and volume momentum with the intention to determine a pattern that calculates the direction of the firm's future prices. Please check out Home Depot maximum drawdown, and the relationship between the information ratio and downside variance to decide if Home Depot is priced fairly, providing market reflects its last-minute price of 368.5 per share. Given that Home Depot has jensen alpha of 0.0811, we strongly advise you to confirm Home Depot's regular market performance to make sure the company can sustain itself at a future point.Home Depot's insider trading activities
Some recent studies suggest that insider trading raises the cost of capital for securities issuers and decreases overall economic growth. Trading by specific Home Depot insiders, such as employees or executives, is commonly permitted as long as it does not rely on Home Depot's material information that is not in the public domain. Local jurisdictions usually require such trading to be reported in order to monitor insider transactions. In many U.S. states, trading conducted by corporate officers, key employees, directors, or significant shareholders must be reported to the regulator or publicly disclosed, usually within a few business days of the trade. In these cases Home Depot insiders are required to file a Form 4 with the U.S. Securities and Exchange Commission (SEC) when buying or selling shares of their own companies.
Vanwoerkom Jack over a year ago Exercise or conversion by Vanwoerkom Jack of 25938 shares of Home Depot subject to Rule 16b-3 |
Home Depot's Outstanding Corporate Bonds
Home Depot issues bonds to finance its operations. Corporate bonds make up one of the largest components of the U.S. bond market, which is considered the world's largest securities market. Home Depot uses the proceeds from bond sales for a wide variety of purposes, including financing ongoing mergers and acquisitions, buying new equipment, investing in research and development, buying back their own stock, paying dividends to shareholders, and even refinancing existing debt. Most Home bonds can be classified according to their maturity, which is the date when Home Depot has to pay back the principal to investors. Maturities can be short-term, medium-term, or long-term (more than ten years). Longer-term bonds usually offer higher interest rates but may entail additional risks.
| CVS Health Corp Corp BondUS126650DE72 | View | |
| HOME DEPOT INC Corp BondUS437076AS19 | View | |
| HOME DEPOT INC Corp BondUS437076BY77 | View | |
| HOME DEPOT INC Corp BondUS437076BZ43 | View | |
| HOME DEPOT INC Corp BondUS437076BW12 | View | |
| HOME DEPOT INC Corp BondUS437076BX94 | View | |
| HOME DEPOT INC Corp BondUS437076CG52 | View | |
| HD 15 15 SEP 28 Corp BondUS437076CH36 | View |
Understand Home Depot's technical and predictive indicators
Using predictive indicators to make investment decisions involves analyzing Home Depot's various financial and market-based factors to help forecast future trends and identify investment opportunities. Select the indicators that are most relevant to your investment strategy. Each indicator has its own strengths and weaknesses, so it's essential to combine multiple indicators to get a more comprehensive view of the market and reduce the risk of making poor decisions based on limited data.
| Risk Adjusted Performance | 0.1206 | |||
| Market Risk Adjusted Performance | 0.1935 | |||
| Mean Deviation | 1.13 | |||
| Semi Deviation | 1.38 | |||
| Downside Deviation | 1.54 | |||
| Coefficient Of Variation | 663.56 | |||
| Standard Deviation | 1.43 | |||
| Variance | 2.06 | |||
| Information Ratio | 0.0661 | |||
| Jensen Alpha | 0.0811 | |||
| Total Risk Alpha | (0) | |||
| Sortino Ratio | 0.0615 | |||
| Treynor Ratio | 0.1835 | |||
| Maximum Drawdown | 6.22 | |||
| Value At Risk | (2.59) | |||
| Potential Upside | 2.51 | |||
| Downside Variance | 2.37 | |||
| Semi Variance | 1.91 | |||
| Expected Short fall | (1.19) | |||
| Skewness | (0.49) | |||
| Kurtosis | 0.1377 |
| Risk Adjusted Performance | 0.1206 | |||
| Market Risk Adjusted Performance | 0.1935 | |||
| Mean Deviation | 1.13 | |||
| Semi Deviation | 1.38 | |||
| Downside Deviation | 1.54 | |||
| Coefficient Of Variation | 663.56 | |||
| Standard Deviation | 1.43 | |||
| Variance | 2.06 | |||
| Information Ratio | 0.0661 | |||
| Jensen Alpha | 0.0811 | |||
| Total Risk Alpha | (0) | |||
| Sortino Ratio | 0.0615 | |||
| Treynor Ratio | 0.1835 | |||
| Maximum Drawdown | 6.22 | |||
| Value At Risk | (2.59) | |||
| Potential Upside | 2.51 | |||
| Downside Variance | 2.37 | |||
| Semi Variance | 1.91 | |||
| Expected Short fall | (1.19) | |||
| Skewness | (0.49) | |||
| Kurtosis | 0.1377 |
Consider Home Depot's intraday indicators
Home Depot intraday indicators are useful technical analysis tools used by many experienced traders. Just like the conventional technical analysis, daily indicators help intraday investors to analyze the price movement with the timing of Home Depot stock daily movement. By combining multiple daily indicators into a single trading strategy, you can limit your risk while still earning strong returns on your managed positions.
Home Depot Corporate Filings
ASR | 27th of August 2024 Automatic Shelf Registration Statement under Rule 415 filed with the U.S. Securities and Exchange Commission (SEC) | ViewVerify |
10Q | 20th of August 2024 Quarterly performance report mandated by Securities and Exchange Commission (SEC), to be filed by publicly traded corporations | ViewVerify |
F4 | 19th of August 2024 The report filed by a party regarding the acquisition or disposition of a company's common stock, as well as derivative securities such as options, warrants, and convertible securities | ViewVerify |
8K | 13th of August 2024 Report filed with the SEC to announce major events that shareholders should know about | ViewVerify |
Home Stock media impact
Far too much social signal, news, headlines, and media speculation about Home Depot that are available to investors today. That information is available publicly through Home media outlets and privately through word of mouth or via Home internal channels. However, regardless of the origin, that massive amount of Home data is challenging to quantify into actionable patterns, especially for investors that are not very sophisticated with ever-evolving tools and techniques used in the investment management field.
A primary focus of Home Depot news analysis is to determine if its current price reflects all relevant headlines and social signals impacting the current market conditions. A news analyst typically looks at the history of Home Depot relative headlines and hype rather than examining external drivers such as technical or fundamental data. It is believed that price action tends to repeat itself due to investors' collective, patterned thinking related to Home Depot's headlines and news coverage data. This data is often completely overlooked or insufficiently analyzed for actionable insights to drive Home Depot alpha.
Home Depot Sentiment by Major News Outlets
Investor sentiment, mood or attitude towards Home Depot can have a significant impact on its stock price or the market as a whole. This sentiment can be positive or negative, and various factors, such as economic indicators, news events, or market trends, can influence it. When investor sentiment is positive, investors are more likely to buy stocks, increasing demand and increasing the stock price. Positive investor sentiment can be driven by good news about the company or the broader market, such as solid earnings reports or positive economic data.
Note that negative investor sentiment can cause investors to sell stocks, leading to a decrease in demand and a drop in the stock price. Negative sentiment can be driven by factors such as poor earnings reports, negative news about the company or industry, or broader economic concerns. It's important to note that investor sentiment is just one of many factors that can affect stock prices. Other factors, such as company performance, industry trends, and global economic conditions, can also play a significant role in determining the value of a stock.
Home Depot Historical Investor Sentiment
Investor biases related to Home Depot's public news can be used to forecast risks associated with an investment in Home. The trend in average sentiment can be used to explain how an investor holding Home can time the market purely based on public headlines and social activities around Home Depot. Please note that most equities that are difficult to arbitrage are affected by market sentiment the most.
Home Depot's market sentiment shows the aggregated news analyzed to detect positive and negative mentions from the text and comments. The data is normalized to provide daily scores for Home Depot and other traded tickers. The bigger the bubble, the more accurate the estimated score. Higher bars for a given day show more participation in the average Home Depot news discussions. The higher the estimate score, the more favorable the investor's outlook on Home Depot.
Home Depot Maximum Pain Price across 2024-09-06 Option Contracts
Home Depot's options can also be used to analyze investors' bias and current market sentiment in the context of behavioral finance. For example, Max pain usually refers to a trading concept that asserts that market manipulation can cause the market price of Home Depot close to the expiration of its current option contract to expire worthlessly. According to most research, about 35% of options are not executed, with roughly 50% traded out before expiration. So, Max pain occurs when market makers reach a net favorable position across all options at a strike price where option holders stand to lose the most money. By contrast, option sellers may reap the most after selling more options than buying, causing them to expire worthlessly. Please continue to view the detailed analysis of Home Depot's options.
Home Depot Corporate Directors
| Ari Bousbib | Independent Director | Profile | |
| Greg Brenneman | Lead Independent Director | Profile | |
| Gerard Arpey | Independent Director | Profile | |
| Gregory Brenneman | Lead Independent Director | Profile |
Additional Information and Resources on Investing in Home Stock
When determining whether Home Depot is a strong investment it is important to analyze Home Depot's competitive position within its industry, examining market share, product or service uniqueness, and competitive advantages. Beyond financials and market position, potential investors should also consider broader economic conditions, industry trends, and any regulatory or geopolitical factors that may impact Home Depot's future performance. For an informed investment choice regarding Home Stock, refer to the following important reports:Check out Risk vs Return Analysis to better understand how to build diversified portfolios, which includes a position in Home Depot. Also, note that the market value of any company could be closely tied with the direction of predictive economic indicators such as signals in unemployment. For information on how to trade Home Stock refer to our How to Trade Home Stock guide.You can also try the Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
Is Home Improvement Retail space expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Home Depot. If investors know Home will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Home Depot listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth (0.01) | Dividend Share 8.84 | Earnings Share 14.89 | Revenue Per Share 153.47 | Quarterly Revenue Growth 0.006 |
The market value of Home Depot is measured differently than its book value, which is the value of Home that is recorded on the company's balance sheet. Investors also form their own opinion of Home Depot's value that differs from its market value or its book value, called intrinsic value, which is Home Depot's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Home Depot's market value can be influenced by many factors that don't directly affect Home Depot's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
In summary, please note that there is a difference between Home Depot's value and its price, as these two are different measures arrived at by various means. Investors typically determine if Home Depot is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Home Depot's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.