The Home Depot, Inc. (HD) is a publicly traded company in the Consumer Cyclical — Home Improvement industry listed on NYSE. This overview shows the latest price, key valuation ratios, profitability metrics and financial-health indicators used by fundamental investors.
The Home Depot, Inc. operates as a prominent retailer specializing in home renovation and improvement. Through its expansive network of "The Home Depot" stores, it furnishes consumers with an extensive array of goods, including building materials, home enhancement products, lawn and garden supplies, decorative items, and facilities maintenance, repair, and operational (MRO) supplies.
Is The Home Depot, Inc. stock overvalued or undervalued in 2026?
The Home Depot, Inc. (HD) trades at 23.9× earnings (P/E), above the median of the 212 consumer cyclicals companies over $2bn in Kaplio's universe. At the decade median (24.2×) $346 (+1 %); at its sector median (18.4×) $263 (-23 %).
Kaplio overview: The Home Depot, Inc.
Market cap $340B · 52 weeks $281 – $391 (12 % below the high) · P/E 23.9× · 2027 est. P/E 22.8× · Dividend 2.8 % · 16 years rising · Next earnings November 17, 2026 · expected EPS $3.83 · Closing price, Nov 2 · accounts published Aug 18.
- Valuation: TTM P/E 23.9× (fairly priced).
- Business: 5-year ROIC 28.0 % (excellent).
- Balance sheet: Net debt/EBITDA 2.5× (solid).
- Earnings: 5 of 8 (uneven).
What would it be worth at its usual multiples?
At the decade median (24.2×) $346 (+1 %); at its sector median (18.4×) $263 (-23 %). Implied price from applying the reference multiples to today's earnings (or book value, or FFO) per share. Not a fair value: it is where the stock would trade at its usual multiples.
What matters in consumer cyclicals: 7 of 8 pass
- Current Ratio 1.08, fails.
- 5y avg operating margin 14.2 %, passes.
- Inventory turnover 4.3×, passes, near the threshold.
- 5y avg ROIC 28.0 %, passes.
- Net debt / EBITDA 2.5×, passes.
- Altman Z-Score 5.9, passes.
- P/E read in reverse (cyclicals) 23.9×, passes.
- EV/Sales vs history 2.7×, passes.
Against its peers (reference peers) — The Home Depot, Inc.: P/E 23.9×; EV/EBITDA 15.3×; ROIC 18.8 %; $340B. Lowe's Companies, Inc. (P/E 18.4×; EV/EBITDA 12.6×; ROIC 20.6 %; $122B), Floor & Decor Holdings, Inc. (P/E 22.0×; EV/EBITDA 11.8×; ROIC 4.9 %; $5.1B), United Rentals, Inc. (P/E 26.0×; EV/EBITDA 11.3×; ROIC 11.4 %; $72.8B).
Expensive or cheap against its last ten years?
P/E at each close: today 23.9× · median 24.2× · minimum 15.6× · maximum 34.7× · cheap below 22.6× · expensive above 26.9×. It has been cheaper than today only 46% of the time over its last ten years.
Dividend
solid · Yield (last 12 months) 2.8 % · $9.20 per share in 2025 · Years raising it 16 · 5-year growth +9 % a year · Free cash flow coverage 1.8× (last three fiscal years) · With $1,000 invested today you'd collect $28.20 a year ($2.35 a month).
Kaplio's reading: The Home Depot, Inc.
Updated on October 24, 2026 · accounts published on August 18, 2026
Reading of October 23, 2026: A highly profitable business with slipping margins and heavy leverage
Home Depot trades at a P/E of 22.4, 8 % below its ten-year median and 26 % above its sector, with ROIC of 18.8 % over the last 12 months.
- Is Home Depot expensive or cheap? Home Depot trades at a P/E of 22.4, 8 % below its ten-year median of 24.2 but 26 % above its sector median.
- How is the business doing? Operating margin is 12.4 % over the last 12 months, below its 14.0 % average for 2014-2025, while EPS fell 4.6 %.
- How strong is the balance sheet? Net debt of $66.84 per share in fiscal 2025 equals 21 % of the share price; the dividend has risen 11 years in a row.
- What to expect from the next earnings? Home Depot reports on November 17, 2026; analysts expect EPS of $3.84, and the 2027 estimate held at $15.00 over 30 days.
- Could the balance sheet hold up in a recession? Net debt is 2.6× EBITDA in fiscal 2025, under the 3.0× sector threshold, but the current ratio of 1.08 misses the 1.5 bar.
Is Home Depot expensive or cheap?
Home Depot's P/E over the last 12 months is 22.4, 8 % below its ten-year median of 24.2. Over the decade the multiple ranged from 15.6 to 34.7, and it traded lower than today only 30 % of the time. Against its sector the picture changes: the median consumer cyclical trades at a P/E of 17.8, so Home Depot carries a 26 % premium. EV/sales of 2.7× in fiscal 2025 is slightly above its ten-year average of 2.5×, still inside the neutral band. The stock has fallen 15 % over 12 months, which makes it look modest against its own history and still demanding against its peers.
How is the business doing?
Revenue grew 3.2 % over the last 12 months while EPS fell 4.6 %: Home Depot is selling more and keeping less. The operating margin of 12.4 % sits below the 12.7 % of fiscal 2025 and under the 14.0 % average of 2014-2025, so margins are drifting lower. Returns remain strong. ROIC of 18.8 % over the last 12 months is 9.5 points above the sector median of 9.3 %, and it stayed above 10 % in each of the last 10 fiscal years. The ROE of 103 % reflects a thin equity base, with P/B at 19.6×, more than extra profitability.
How strong is the balance sheet?
Home Depot runs with heavy leverage: debt to equity is 3.77 over the last 12 months, and net debt of $66.84 per share in fiscal 2025 equals 21 % of today's price. The dividend yields 2.8 % and has grown for 11 consecutive fiscal years, with a payout of 65 % of fiscal 2025 earnings, which leaves room but no wide cushion. An Altman Z of 5.9 places the company in the safe zone, while a Piotroski score of 4 out of 9 points to mixed signals in the latest figures.
What to expect from the next earnings?
Home Depot publishes results on November 17, 2026, with consensus at $3.84 of EPS for the quarter. Its record is mixed: it beat EPS estimates in 5 of the last 8 quarters, and on August 18, 2026 it reported $4.92 against $4.73 expected, 4 % above. Expectations are stable. The 2027 EPS consensus barely moved in the last 30 days, from $15.01 to $15.00 across 21 analysts, and the revenue estimate is also flat. Of 63 analysts, 36 recommend buying, 22 holding and 4 selling. The figure to watch is the operating margin, now below its long-term average.
Could the balance sheet hold up in a recession?
In consumer cyclicals demand can drop fast, so the sector is judged on multi-year margins and returns, inventory speed and whether debt survives a smaller EBITDA. Home Depot passes most tests. Its five-year operating margin of 14.2 % clears the 8 % bar, five-year ROIC of 28.0 % beats 12 %, and net debt of 2.6× EBITDA in fiscal 2025 stays below 3.0×, though that is a current reading and not a cycle average. Inventory turnover of 4.3× passes narrowly against a 4.0× floor. The weak spot is liquidity: a current ratio of 1.08 falls short of the healthy 1.5.
How this was prepared: the data comes from companies' official filings, collected by a professional provider, and from Kaplio's analysis engine (trailing-12-month ratios, 10 years of history and sector medians computed across US-listed companies). The text is written from that data alone, every figure is checked against it before publication, and it is reviewed when the company reports results. This is not investment advice.
Investor methods verdict
Would Peter Lynch approve Home Depot today?
The Lynch Method approves Home Depot today. Business quality: 58 out of 100 (price not included). Lynch classifies it as a slow grower. Kaplio assessment with data from the week of November 2, 2026; not investment advice.
Profitability
| Return on Equity | 102.68% |
| Return on Invested Capital | 18.80% |
| Return on Assets | 13.01% |
| Gross Margin | 33.21% |
| Operating Margin | 12.43% |
| Net Margin | 8.41% |
Financial Health
| Debt / Equity | 3.77 |
| Current Ratio | 1.08 |
| Piotroski F-Score | 4 |
| Altman Z-Score | 5.95 |
Compare it with
Price Performance
| 1 month | +20.61% |
| 3 months | -3.40% |
| Year-to-date | -0.86% |
| 1 year | -9.83% |
| 3 years | +15.41% |
| 5 years | -8.34% |
| 10 years | +182.15% |
Dividend History
Paid in the last 12 months: $9.29 per share in 4 payments.
| Date | Amount |
|---|---|
| September 3, 2026 | $2.33 |
| June 4, 2026 | $2.33 |
| March 12, 2026 | $2.33 |
| December 4, 2025 | $2.30 |
| September 4, 2025 | $2.30 |
| June 5, 2025 | $2.30 |
| March 13, 2025 | $2.30 |
| November 27, 2024 | $2.25 |
| August 29, 2024 | $2.25 |
| May 30, 2024 | $2.25 |
Amounts adjusted for stock splits.
Related companies: LOW · URI · 0JVQ.L · TYT.L · AMZN · TSLA · BABA · TM
Explore sector: Consumer Cyclical · Home Improvement
More sections of HD: Financials · Valuation · Statistics · Estimates · Technical · Ownership · News · Events
Discover more: Weekly Radar: the S&P 500 through the Buffett and Lynch methods · Companies that pass the Buffett method · Companies that pass the Lynch method · Stocks that pass Graham's defensive investor test today · Investment Academy — learn to analyze stocks