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HD DD: what Buffett would see here
Home Depot, Inc. (The) (HD)
Value DD. Boring on purpose. The exciting stocks are the ones that lose you money.
WHAT THEY DO
The Home Depot, Inc.
VALUATION
Trailing P/E 21.0x, forward 18.7x.
PEG 2.53.
Price/sales 1.8x, price/book 18.0x.
Net margin 8.4%.
Revenue growth +5.7%, earnings growth +4.6%.
Short interest 1.0% of float.
BALANCE SHEET
Financial health 5.0/10 (fair). Weakest points: debt to equity, peg ratio.
✗ Debt to equity: 4.20 (benchmark < 0.5). Debt of 4.20x equity is high against the 0.5x benchmark. It has improved over the last 4 years.
✗ PEG ratio: 2.53 (benchmark < 1). At 2.53, the price looks expensive relative to expected growth. Lynch treated 1.0 as fair value.
✓ Return on equity: 104.3% (benchmark > 15%).
✓ Free cash flow: $12.6B (benchmark positive).
THROUGH THE LENSES
Benjamin Graham: 4.2/10. Falls short of Graham's bar on price to book, current ratio, debt to equity.
Warren Buffett: 7.5/10. Clears every Buffett test it can be measured on.
Charlie Munger: 6.0/10. Falls short of Munger's bar on debt to equity.
Peter Lynch: 3.8/10. Falls short of Lynch's bar on peg ratio, debt to equity.
Philip Fisher: 7.5/10. Clears every Fisher test it can be measured on.
NEXT CATALYST
Earnings on 2026-11-17.
Street expects EPS of $3.84 on revenue of $42.8B.
THE READ
Graham 4.2/10, Buffett 7.5/10. Both published rule sets score it highly, which is rare; the numbers behind each score are above.
value_vic is an automated CasePit house account and holds no position. Not investment advice.
HD6 Months
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