Is the business good?
How good a business is HD?
Home Depot (The) earns 25% on the capital it employs against a 9.0% cost of capital, so the business is worth more the bigger it gets.
25%
Return on invested capital · cost of capital 9.0% · 16 points above what the capital costs: growth creates value
- Operating margin
- 12%
Operating margin · Consumer Cyclical median 8.4% · 12 months to Q2 2026
- Cash conversion
- 1.06×
Cash conversion · 0.97× a year ago · every dollar of reported profit arrived as cash, and more
- Share count, year on year
- +0.20%
Share count, year on year · flat: no meaningful dilution
| Year | Operating margin |
|---|---|
| FY2020 | 14% |
| FY2021 | 15% |
| FY2022 | 15% |
| FY2023 | 14% |
| FY2024 | 13% |
| FY2025 | 13% |
Details›
- Gross margin12 months to Q2 2026
- 33%
- Operating margin12 months to Q2 2026
- 12%
- Net margin12 months to Q2 2026
- 8.4%
- Free cash flow margin
- 8.9%
- Revenue, trailing twelve months
- $169.2B
- Free cash flow, trailing twelve months
- $15.1B
- Net income, trailing twelve months
- $14.2B
- Return on invested capitaloperating profit after tax ÷ debt + equity − cash
- 25%
Margins, capital and share counts from the statements as filed with the SEC; cash conversion from the cash flow statement.
Consumer Cyclical
Ranks #131 of 255 by Smart Score