valuation.digital Deutsch
Not investment advice. Model values are estimates from a fixed, published method — no buy or sell recommendation.

Home Depot valuation

HOME DEPOT, INC. · NYSE: HD · Consumer discretionary · Updated Sep 25, 2026

Price-implied growth
3.7%
year-1 revenue growth the price implies at our base-case margin (base case: 2.0%)
Price-implied margin
14.8%
target operating margin at our base-case growth (base case: 13.8%)
Base-case model value
$269.33
range $162.54 – $416.98 (Bear–Bull)
Price vs. base case
+8%
reference price $292.15 (IEX last trade, Sep 24, 2026)
Market value
$291B
$292.15 × 996.0 m diluted shares
WACC
9.9%
years 1–5, then moving to 8.9% (mature company)

Home Depot's revenue grew 2.5% over the last twelve months and 1.5% a year over three years. Today's price of $292.15 implies 3.7% revenue growth in year 1, fading to 4.8% by year 10, at an operating margin of 13.8%.

Our base case continues the trend (2.0%, fading), moves the operating margin from 13.1% to 13.8% by year 5 and reinvests $0.26 of capital for each additional dollar of revenue. Discounted at 9.9%, that gives a base-case model value of $269.33 per share (bear $162.54, bull $416.98); the price is 8% above the base case.

Model value per share: bear, base, bull – and the price
Bear $162.54 – Bull $416.98Base: $269.33Base $269.33Bear $162.54Bull $416.98Price: $292.15Price $292.15

Bear: growth 5 percentage points lower, target margin 20% lower. Bull: growth 5 points higher, target margin 20% higher. Cost of capital and capital intensity as in the base case.

Model value = output of a fixed, published method; not a price target, not a recommendation. How the model works

How we got this number

1Historical base from the filingsReported fact

All figures come from the XBRL data in the company's SEC filings (10-K, 10-Q), in US dollars. "TTM" = trailing twelve months. EBITA = operating income before amortisation of acquired intangibles and before expensed acquired R&D – both consequences of past acquisitions, which the model does not extrapolate.

Revenue and EBITA
RevenueEBITA
0$50B$100B$150B$200B01/21 · Revenue: $132B01/21 · EBITA: $18.3B01/2101/22 · Revenue: $151B01/22 · EBITA: $23.0B01/2201/23 · Revenue: $157B01/23 · EBITA: $24.2B01/2301/24 · Revenue: $153B01/24 · EBITA: $21.9B01/2402/25 · Revenue: $160B02/25 · EBITA: $22.0B02/2502/26 · Revenue: $165B02/26 · EBITA: $21.5B02/26TTM · Revenue: $169BTTM · EBITA: $21.7BTTM
Data tableFY01/2021FY01/2022FY01/2023FY01/2024FY02/2025FY02/2026TTM08/2026
Revenue $132B$151B$157B$153B$160B$165B$169B
Revenue growth –14.4%4.1%−3.0%4.5%3.2%2.5%
Operating income (EBIT) $18.3B$23.0B$24.0B$21.7B$21.5B$20.9B$21.0B
+ Amortisation of acquired intangibles ––$179M$186M$425M$607M$678M
EBITA $18.3B$23.0B$24.2B$21.9B$22.0B$21.5B$21.7B
EBITA margin 13.8%15.2%15.4%14.3%13.8%13.1%12.8%
Effective tax rate 24.2%24.4%23.9%24.0%23.7%23.9%–
Net income $12.9B$16.4B$17.1B$15.1B$14.8B$14.2B$14.2B
Operating cash flow $18.8B$16.6B$14.6B$21.2B$19.8B$16.3B$18.8B
Capital expenditure $2.46B$2.57B$3.12B$3.23B$3.48B$3.68B$3.68B
Free cash flow (CFO − capex) $16.4B$14.0B$11.5B$17.9B$16.3B$12.6B$15.1B
Operating invested capital ––$38.4B$38.1B$39.5B$44.8B$44.4B
Sales / capital ––4.104.014.043.683.81
ROIC ––48.0%43.6%42.4%36.6%38.1%

Operating invested capital = equity + financial debt incl. leases − cash − goodwill − acquired intangibles − equity-method stakes: the capital that organic growth actually ties up. ROIC = EBITA × (1 − tax rate) / operating capital (TTM column: incl. lease interest, latest balance sheet). TTM revenue = FY ending 2026-02-01 ($165B) + year-to-date to 2026-08-02 ($89.6B) − prior-year period ($85.1B).

XBRL source of each line
  • revenue: us-gaap:RevenueFromContractWithCustomerExcludingAssessedTax · TTM · period end 2026-08-02 · 0001628280-26-058715
  • cost_of_revenue: us-gaap:CostOfRevenue · TTM · period end 2026-08-02 · 0001628280-26-058715
  • gross_profit: us-gaap:GrossProfit · TTM · period end 2026-08-02 · 0001628280-26-058715
  • ebit: us-gaap:OperatingIncomeLoss · TTM · period end 2026-08-02 · 0001628280-26-058715
  • pretax: us-gaap:IncomeLossFromContinuingOperationsBeforeIncomeTaxesExtraordinaryItemsNoncontrollingInterest · TTM · period end 2026-08-02 · 0001628280-26-058715
  • tax: us-gaap:IncomeTaxExpenseBenefit · TTM · period end 2026-08-02 · 0001628280-26-058715
  • net_income: us-gaap:NetIncomeLoss · TTM · period end 2026-08-02 · 0001628280-26-058715
  • da: us-gaap:DepreciationDepletionAndAmortization · TTM · period end 2026-08-02 · 0001628280-26-058715
  • cfo: us-gaap:NetCashProvidedByUsedInOperatingActivities · TTM · period end 2026-08-02 · 0001628280-26-058715
  • capex: us-gaap:PaymentsToAcquireProductiveAssets · TTM · period end 2026-08-02 · 0001628280-26-058715
  • sbc: us-gaap:ShareBasedCompensation · TTM · period end 2026-08-02 · 0001628280-26-058715
  • interest: us-gaap:InterestExpenseNonoperating · TTM · period end 2026-08-02 · 0001628280-26-058715
  • amort: us-gaap:AmortizationOfIntangibleAssets · TTM · period end 2026-08-02 · 0001628280-26-058715

2Cost of equity (CAPM)Market dataAssumption

kE = rf + β × ERP = 4.79% + 1.53 × 4.14% = 11.14%
  • rf 4.79% – 10-year US Treasury yield on Sep 1, 2026, the date of the equity risk premium estimate (the two must match; today: 5.18% on Sep 24, 2026) (U.S. Treasury).
  • ERP 4.14% – implied equity risk premium of the S&P 500 by Aswath Damodaran as of Sep 1, 2026 (NYU Stern). It is backed out of current index prices and expected cash flows, not historical averages.
  • β 1.53 – bottom-up beta: the "Retail (Building Supply)" industry (14 US firms, Damodaran, January 2026) has a cash-corrected unlevered beta of 1.32. Relevered with Home Depot's leverage (debt incl. leases / market value = 21.5%):
    β = βU × (1 + (1 − t) × D/E) = 1.32 × (1 + 0.75 × 0.215) = 1.53
  • In the mature state (from year 10) we set β = 1: kE = 4.79% + 4.14% = 8.93%, the market's expected return. In years 6–10 the cost of capital moves there linearly.

3Cost of debtReported factAssumption

Interest coverage = EBIT / interest expense (TTM) = $21.0B / $2.42B = 8.7x. In Damodaran's table for large non-financial firms (January 2026) this maps to a synthetic rating of Aaa/AAA with a 0.40% default spread.

kD = (rf + spread) × (1 − t) = (4.79% + 0.40%) × (1 − 25%) = 3.89%

Tax rate 25%: 21% federal plus about 4% state taxes (marginal rate).

4Weighted average cost of capital (WACC)Market dataModel output

WACC = E/(D+E) × kE + D/(D+E) × kD = 82.3% × 11.14% + 17.7% × 3.89% = 9.85%

E = market value $291B (Sep 24, 2026); D = financial debt incl. lease liabilities $62.6B (book value as a proxy). This WACC applies to years 1–5; by year 10 it moves to 8.93%, the cost of capital of an average mature company (rf + ERP) – the rate at which Damodaran's implied premium discounts the market beyond year 5.

5Forecast and discounted cash flowsAssumptionModel output

DriverBase caseHow it is set
Revenue growth, year 12.0%Average of the 3-year CAGR (1.5%) and trailing-twelve-month growth (2.5%); fades linearly to 4.8% by year 10.
Operating margin13.1% → 13.8%Currently 13.1% (EBITA incl. lease interest); target in year 5: the company's own recent level (13.8%, average of three fiscal years and TTM), as it is above the industry (11.8%).
Tax rate23.9% → 25%Effective rate of the last three years (years 1–5), then moving to the marginal rate.
Sales / capital3.91Reinvestment = revenue increase / 3.91. Company's 3-year average (3.91).
Terminal ROIC35.0%The lower of the company's return on capital (38.1%) and the industry's (35.0%), but at least the cost of capital (8.9%). Terminal reinvestment rate = g / ROIC = 13.7%.
Growth after year 104.79%= risk-free rate (Damodaran's default; his implied premium is computed the same way).

Industry values: Damodaran, "Retail (Building Supply)", January 2026 (pre-tax lease-adjusted operating margin; sales / invested capital; after-tax return on capital).

Year12345678910
Revenue growth2.0%2.3%2.6%2.9%3.2%3.6%3.9%4.2%4.5%4.8%
Revenue$173B$177B$181B$187B$193B$199B$207B$216B$225B$236B
Operating margin13.3%13.4%13.5%13.7%13.8%13.8%13.8%13.8%13.8%13.8%
Operating income$22.9B$23.6B$24.5B$25.5B$26.6B$27.5B$28.6B$29.7B$31.1B$32.6B
Tax rate23.9%23.9%23.9%23.9%23.9%24.1%24.3%24.5%24.8%25.0%
NOPAT$17.4B$18.0B$18.7B$19.4B$20.2B$20.9B$21.6B$22.4B$23.4B$24.4B
− Reinvestment$868M$1.02B$1.19B$1.36B$1.55B$1.75B$1.97B$2.21B$2.47B$2.76B
= FCFF$16.5B$17.0B$17.5B$18.0B$18.7B$19.1B$19.6B$20.2B$20.9B$21.7B
WACC9.9%9.9%9.9%9.9%9.9%9.7%9.5%9.3%9.1%8.9%
Discount factor0.9100.8290.7540.6870.6250.5700.5210.4760.4360.401
Present value$15.1B$14.1B$13.2B$12.4B$11.7B$10.9B$10.2B$9.64B$9.13B$8.68B
ROIC (model capital)40.2%40.8%41.3%41.8%42.4%42.4%42.4%42.4%42.4%42.4%
Terminal value = NOPAT11 × (1 − g/ROIC) / (WACCmature − g) = $25.6B × (1 − 4.79% / 35.0%) / (8.93% − 4.79%) = $534B
EV = $115B + $534B × 0.401 = $329B

The terminal value is 65% of enterprise value. Cash flows are discounted at year end with the cumulative cost of capital of each year.

6From enterprise value to equity valueReported factModel output

From enterprise value to equity value, compared with the market value
Model valueMarket value
PV of FCFF, years 1–10PV of FCFF, years 1–10: $115B$115BPV of terminal valuePV of terminal value: $214B$214BEnterprise valueEnterprise value: $329B$329BCash & securitiesCash & securities: $2.08B$2.08BDebt incl. leasesDebt incl. leases: −$62.6B−$62.6BEquity value (model)Equity value (model): $268B$268BMarket capitalisationMarket capitalisation: $291B$291B
Enterprise value$329B
+ Cash and equivalents us-gaap:CashAndCashEquivalentsAtCarryingValue · 2026-08-02$2.08B
− Long-term debt us-gaap:LongTermDebtAndCapitalLeaseObligations · 2026-08-02−$44.0B
− Current debt us-gaap:LongTermDebtAndCapitalLeaseObligationsCurrent · 2026-08-02−$4.70B
− Commercial paper us-gaap:CommercialPaper · 2026-08-02−$4.25B
− Operating lease liabilities us-gaap:OperatingLeaseLiabilityNoncurrent+OperatingLeaseLiabilityCurrent · 2026-08-02−$9.67B
= Equity value (model)$268B
÷ Diluted shares WeightedAverageNumberOfDilutedSharesOutstanding · 2026-08-02996.0 m
= Base-case model value per share$269.33
Reference price (IEX last trade) · 2026-09-24 19:59 UTC$292.15

Lease liabilities count as debt; in turn, the operating margin excludes the interest component of lease payments. Share count: diluted weighted-average shares, latest quarter. Data provided for free by IEX. By accessing or using IEX Historical Data, you agree to the IEX Historical Data Terms of Use.

7Scenarios and reverse DCF: what the price impliesModel output

CaseGrowth Y1Target marginModel value per sharePrice vs. case
Bear−3.0%11.0%$162.54+80%
Base2.0%13.8%$269.33+8%
Bull7.0%16.5%$416.98−30%
Implied by the price3.7%14.8%$292.15±0%

Reverse DCF: holding everything else fixed, we solve for the single assumption at which the model value equals the price – the starting growth rate (3.7%), the target margin (14.8%) or the cost of capital (9.6% instead of 9.9%).

Revenue growth: history, model path and market-implied path
Historical growthModel growth pathMarket-implied path
−4%−2%0%2%4%6%2023: 4.1%'232024: −3.0%'242025: 4.5%'252026: 3.2%'26Model growth path, year 1: 2.0%Model growth path, year 2: 2.3%Model growth path, year 3: 2.6%Model growth path, year 4: 2.9%Model growth path, year 5: 3.2%Model growth path, year 6: 3.6%Model growth path, year 7: 3.9%Model growth path, year 8: 4.2%Model growth path, year 9: 4.5%Model growth path, year 10: 4.8%Market-implied path, year 1: 3.7%Market-implied path, year 2: 3.9%Market-implied path, year 3: 4.0%Market-implied path, year 4: 4.1%Market-implied path, year 5: 4.2%Market-implied path, year 6: 4.3%Market-implied path, year 7: 4.4%Market-implied path, year 8: 4.6%Market-implied path, year 9: 4.7%Market-implied path, year 10: 4.8%Y1Y10

8Sensitivity: WACC × terminal growthModel output

Base-case model value per share for other costs of capital (rows: WACC of years 1–5; the shift applies to all years) and other growth after year 10 (columns). Outlined: base case. Reference price: $292.15.

WACC \ g2.8%3.3%3.8%4.3%4.8%
8.9%$239.02$261.37$289.02$324.14$370.31
9.4%$212.98$230.80$252.36$279.04$312.92
9.9%$191.17$205.62$222.81$243.61$269.33
10.4%$172.63$184.53$198.46$215.04$235.10
10.9%$156.67$166.59$178.06$191.50$207.48

Multiples vs. peers

Peer group "Consumer discretionary" within our coverage. Ratios use trailing-twelve-month figures and market values as of Sep 24, 2026. EV = market value + debt incl. leases + minorities − cash.

CompanyMarket valueImpliedgrowthBasegrowthPrice vs.base caseEV/EBITDAP/EP/SEBIT-marginGrowthlast FY
Tesla $1.34T–8.5%+1,322%133.5x351.8x12.9x 4.2%−2.9%
Home Depot $291B3.7%2.0%+8%14.3x20.5x1.7x 12.4%3.2%
McDonald's $168B5.8%5.7%±0%16.9x19.1x6.1x 46.2%3.7%
Nike $53.4B−3.8%0.0%−12%11.4x17.2x1.2x 9.1%0.2%
Lowe's $106B−1.1%2.1%−15%11.3x15.9x1.2x 11.4%3.1%
Peer median−1.1%3.9%14.2x18.1x3.6x10.2%1.7%

Median excludes Home Depot. "n/m": negative or not meaningful.

What management says

Short, attributed excerpts from the company's own latest earnings release (SEC Form 8-K, Exhibit 99.1). Quotes are reproduced verbatim; they are management's statements, not ours.

The Home Depot Announces Second Quarter Fiscal 2026 Results;
Earnings release · Form 8-K · filed Aug 18, 2026 · Document at the SEC

“Our second quarter results exceeded our expectations. We saw broad based demand across the business as customers continued to engage in smaller projects”

— Richard McPhail, Executive Vice President and Chief Financial Officer

“This quarter’s results were a testament to our investments across the business and our associates’ focus on customer service. Our teams did an exceptional job executing throughout a dynamic environment, and I would like to thank them for their continued hard work and dedication”

— Ann-Marie Campbell, Senior Executive Vice President

Outlook excerpt: “Our adjusted diluted earnings per share guidance for fiscal 2026 excludes an expected after-tax impact of a pproximately $0.50 from acquired intangible asset amortization.”

Competitors and their recent moves

Notable filings by peers in the last 120 days (SEC Form 8-K items such as acquisitions, material agreements, restructurings, leadership changes and results).

  • Sep 23, 2026 · McDonald's
    Regulation FD disclosure · 8-K
  • Sep 16, 2026 · Nike
    Board or executive changeRegulation FD disclosure · 8-K
  • Sep 10, 2026 · Nike
    Board or executive change · 8-K
  • Sep 2, 2026 · Lowe's
    Board or executive change · 8-K
  • Aug 19, 2026 · Lowe's
    Quarterly or annual results · 8-K
  • Aug 10, 2026 · Nike
    Board or executive change · 8-K
  • Aug 4, 2026 · McDonald's
    Board or executive changeRegulation FD disclosureMcDonald's Appoints Skye Anderson as President of McDonald's USA · 8-K
  • Aug 4, 2026 · McDonald's
    Quarterly or annual resultsMcDONALD'S REPORTS SECOND QUARTER 2026 RESULTS · 8-K
  • Jul 22, 2026 · Tesla
    Quarterly or annual results · 8-K
  • Jul 2, 2026 · Tesla
    Quarterly or annual resultsTesla Second Quarter 2026 Production, Deliveries & Deployments · 8-K

Analyst ratings

Consensus ratings and price targets from brokers are licensed data. We do not republish them. You can compare our model with the analyst consensus at these public sources:

External links; we are not responsible for their content.

Disclosure (MAR Art. 20)

Producer
NyxAI GmbH, Reiterkasernstraße 2a, 85049 Ingolstadt, Germany · responsible: Lars Heppert · Legal notice
Model completed
2026-09-25 14:19 UTC (automated daily run)
First published / last updated
2026-09-25 14:11 UTC / 2026-09-25 14:19 UTC
Prices used
Last regular-session trade on IEX on 2026-09-24 at 19:59:58 UTC: $292.15. This is not the official closing price of the primary exchange.
Financial data
SEC Form 10-Q, period 2026-08-02, filed 2026-08-25; balance sheet date 2026-08-02
Methodology
How the model works · steps 1–8 above
Main assumptions
rf 4.79% · ERP 4.14% · β 1.53 · WACC 9.85% → 8.93% · growth 2.0% → 4.79% · target margin 13.8% · sales/capital 3.91 · ROICterm 35.0% · scenarios: step 7, sensitivity: step 8
Nature of this information
Model-based estimate (base-case model value with a bear–bull range), computed automatically from public data with a fixed method. Not investment advice, not a recommendation to buy, sell or hold, not a price target, no investment horizon. The result depends heavily on the assumptions. Reported facts, market data, assumptions and model outputs are labelled above.
Conflicts of interest
Neither NyxAI GmbH (producer) nor its affiliated companies nor the responsible person hold positions in HOME DEPOT, INC..NyxAI GmbH receives no payment from the companies covered for these pages, and they had no influence on content or results. Disclosures (as of Sep 25, 2026).

Sources for this page