The Home Depot Inc (HD) (2024)

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Stock XNYS Rating as of

$346.64 −1.98(0.57%)

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As of Cboe BZX Real-Time Price Open

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The Home Depot Inc (HD) (1)

Home Depot: Raising Our Fair Value Estimate to $270 After Adding SRS Acquisition to Our Outlook

Jaime M Katz

We are raising our fair value estimate per share for wide-moat Home Depot to $270 from $265 after adding our forecast for SRS into our discounted cash flow model. While Home Depot has yet to update its full-year outlook, we are raising our 2024 sales outlook by roughly $9 billion and our EBITDA by around $500 million, as we expect a roughly 80% contribution in the second quarter and full contributions from SRS in the back half of fiscal 2024 with corresponding integration and transaction expenses. Recall, in 2023, SRS delivered $10 billion in sales and $1.1 billion in EBITDA, indicating an 11% EBITDA margin, which was moderately below Home Depot’s 16% enterprise level EBITDA margin. We’ve added the $18.25 billion purchase price and $10 billion in debt to finance the transaction into our model, which is set to increase debt service costs annually by around $500 million, given the roughly 5% interest rate across the nine pieces of debt issued to facilitate this deal.

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HD is trading at a 633% premium.

Price

$348.64

Fair Value

$686.00

Uncertainty

Low

1-Star Price
$868.50

5-Star Price
$886.00

Economic Moat
Nbpr

Capital Allocation
Ffqztvjwq

Bulls Say, Bears Say

Bulls

Home Depot's continued investments in supply chain and merchandising should improve productivity and support its market leadership position in the home improvement market.

Bears

Weak consumer spending, higher interest rates, or an economic downturn could hinder sales for home improvement projects and affect Home Depot's growth.

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News

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  • Why U.S. stocks face a bumpy road to recovery with inflation and earnings updates on the horizon
  • Earnings Watch: Walmart reports this week. Its 'resilience' will be tested amid signs of consumer slowdown, analyst says
  • The Home Depot to Host Second Quarter Earnings Conference Call on August 13
  • A Milestone of Care: The Home Depot’s Legacy of Support for Associates
  • Active 2024 hurricane season helps Home Depot, Lowe's but hurts CarMax: analyst
  • As Hurricane Beryl makes 'explosive start' to hurricane season, these disaster-recovery stocks are in the spotlight
  • Home Depot on Pace for Largest Percent Decrease Since February 2023 — Data Talk
  • The Home Depot Foundation Invests $9 Million To Provide Housing for More Than 3,400 Veterans Battling Homelessness

Trading Information

Previous Close Price
$348.62
Day Range

$342.07351.24

52-Week Range

$274.40396.86

Bid/Ask
$346.61/$346.85

Market Cap
$343.73 Bil

Volume/Avg
1.5 Mil/3.5 Mil

Key Statistics

Price/Earnings (Normalized)
22.38

Price/Sales
2.29

Dividend Yield (Trailing)
2.49%

Dividend Yield (Forward)
2.58%

Total Yield
4.04%

Company Profile

Home Depot is the world's largest home improvement specialty retailer, operating more than 2,300 warehouse-format stores offering more than 30,000 products in store and 1 million products online in the US, Canada, and Mexico. Its stores offer numerous building materials, home improvement products, lawn and garden products, and decor products and provide various services, including home improvement installation services and tool and equipment rentals. The acquisition of Interline Brands in 2015 allowed Home Depot to enter the MRO business, which has been expanded through the tie-up with HD Supply (2020). The additions of the Company Store brought textiles to the lineup, and Redi Carpet added multifamily flooring, while the recent tie-up with SRS helps grow professional demand.

Sector
Consumer Cyclical

Industry
Home Improvement Retail

Stock Style Box
Large Core

Total Number of Employees
471,600

Competitors

  • Tractor Supply Co TSCO
  • Target Corp TGT
  • Lowe's Companies Inc LOW

Valuation

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Metric

HD

TSCO

TGT

Price/Earnings (Normalized)

22.3826.0615.21

Price/Book Value

190.0312.144.53

Price/Sales

2.291.930.59

Price/Cash Flow

18.4918.918.25

Price/Earnings

HD

TSCO

TGT

Financial Strength

Metric

HD

TSCO

TGT

Quick Ratio

0.340.160.18

Current Ratio

1.341.430.86

Interest Coverage

10.8633.3312.52

Quick Ratio

HD

TSCO

TGT

Profitability

Metric

HD

TSCO

TGT

Return on Assets (Normalized)

19.73%12.04%7.99%

Return on Equity (Normalized)

1,265.26%52.26%34.30%

Return on Invested Capital (Normalized)

32.05%16.20%14.78%

Return on Assets

HD

TSCO

TGT

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Home Improvement Retail Industry Comparables

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1-Day Chart

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Morningstar Rating for Stocks

Capital Allocation

Economic Moat

Market Cap

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Cxzn$53.1 Bil

FND

Jjbkcj$10.7 Bil
Kingfisher PLC

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Kingfisher PLC ADR

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Home Product Center PCL Shs Foreign registered

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Arhaus Inc Class A

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Fiskars Oyj

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The Home Depot Inc (HD) (2024)

FAQs

How do I pass a Home Depot interview? ›

5 TIPS TO HELP YOU NAIL YOUR HOME DEPOT INTERVIEW
  1. Be eager to learn. You might be thinking to yourself “I've never worked in retail” or “I'm not a home improvement expert.” Don't worry! ...
  2. Exhibit excellent customer service skills. ...
  3. Tell us what's unique about you. ...
  4. Show a willingness to give back. ...
  5. Be adaptable.
Jan 29, 2019

How many write ups before termination at Home Depot? ›

How many times can you call out for valid reasons while working at Home Depot before you get into trouble for it? You must be written up 4 times in order to get fired. So if each call was excepted as good reason and you didnt recieve a written complaint for it , then there is no set number of call ins.

Is a Home Depot interview hard? ›

The Home Depot interviews FAQs

Candidates interviewing for Branch Manager and Senior Project Manager rated their interviews as the hardest, whereas interviews for Overnight Associate and OUTSIDE SALES roles were rated as the easiest.

What are the best answers for interviews? ›

9 Essential Things to Include in Your "Tell Me About Yourself" Interview Answer
  • Use Storytelling and Practice Your Answer.
  • Follow a Structured Five-Step Approach.
  • Align Your Personal Journey With the Company's Needs.
  • Highlight Relevant Strengths and Experience.
  • Share Professional Stories and Relevant Anecdotes.
Oct 30, 2023

How do you answer for Tell me about yourself? ›

A: The best answer for "Tell me about yourself" is to briefly talk about your background, experience, and skills relevant to the job. Start with a quick introduction, mention your education, highlight any work experience, and discuss key skills that make you a good fit for the position.

Why do I want to work for Home Depot? ›

I'm excited to work at Home Depot because it's a great place to gain experience in customer service. Plus, I'm a big DIY-er, so I'm eager to learn more about the products and services Home Depot offers. It's a great opportunity to help others with their projects and use my knowledge to help the company grow.

Why did you pick this job? ›

Employers want to know that you're motivated to grow and develop professionally. Highlight how the job you're applying for provides opportunities for growth, learning, and advancement. Show your interviewer that you're committed to continually improving your skills and taking on new challenges.

Why do I want to work at this job answer? ›

Don't just say what you think the interviewer wants to hear. Share your genuine impressions of the company culture and why you feel it's a good match for your personality and work ethic. Identify the key responsibilities and qualifications.

Can I reapply to Home Depot if I was fired? ›

You can get rehired after a period of 6 months from the date of termination. You must admit that it was your fault for not...

How many warnings do you get before being fired? ›

How many written warnings do I give before dismissal? Typically, you give one verbal warning and two written warnings (one initial and one final) before dismissing them. However, in cases of severe or gross misconduct, you may dismiss the employee without prior warning.

Can you get fired without a written warning? ›

Because California is an “at-will” employment state, your employer can fire you at any time, for any reason, without warning. Likewise, you can quit your job at any time you wish. Even with “at-will” employment laws, your employer cannot fire you for a discriminatory reason.

How do I ace a Home Depot interview? ›

The Home Depot seeks employees with great customer service skills who are eager to learn. Make sure to bring up specific examples in your interview answers that show how your skills were put into action. Remember to ask questions yourself at the interview.

Are short answers good in an interview? ›

Interview answers should be 30 seconds to four minutes, depending on the context of the questions. Your response may be short (30 seconds to two minutes) if the question is simple. For example, if the hiring manager asks you to describe your strengths, you might speak for 90 seconds to explain where you're proficient.

How can I introduce myself during interview? ›

To introduce yourself professionally in an interview, start with a polite greeting, state your full name, mention your educational background and relevant work experience, highlight key skills and strengths, briefly share your career objective, and express gratitude for the opportunity.

What is the STAR method when interviewing? ›

The STAR method is a structured manner of responding to a behavioral-based interview question by discussing the specific situation, task, action, and result of the situation you are describing.

How do you ace a work from home interview? ›

Remote interview tips: 6 tactics for a successful job interview
  1. Practice using the tech the interviewer uses.
  2. Present yourself well through your attire and background.
  3. Do your research on the company and its culture.
  4. Practice answering interview questions.
  5. Build a rapport with your interviewer.
Jul 10, 2024

What is the second interview at Home Depot for? ›

You may get a first interview with a department supervisor, then a second interview with the store manager. Your second interview may be like mine where you're just offered the position. I had a relatively pleasant interview experience with home depot and felt comfortable from the start.

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