Intrinsic value of Home Depot - HD

Previous Close

$211.68

  Intrinsic Value

$89.88

stock screener

  Rating & Target

str. sell

-58%

Previous close

$211.68

 
Intrinsic value

$89.88

 
Up/down potential

-58%

 
Rating

str. sell

We calculate the intrinsic value of HD stock by summing up the current values of future distributable cash flows generated by the company and dividing the sum by the number of outstanding shares. As such, the intrinsic value calculation depends entirely on projections. The more accurate your projections of the company's performance are - the more reliable is the intrinsic value calculation result. Please make sure to check the stock valuation input data below and adjust it if necessary. The quality of the output (intrinsic valuation result) is only as good as the quality of the input. See also DISCLAIMERS.

STOCK VALUATION INPUT DATA

Revenue (in 0001), $M
Initial revenue growth rate, %
Terminal revenue growth rate, %
Revenue decline factor
Initial discount rate, %
Discount rate multiplier
Variable cost ratio, %
Fixed operating expenses, $M
Interest rate on debt, %
Effective corporate tax rate, %
Production assets / Revenue, %
Life of production assets, yrs
Working capital / Revenue, %
Revenue / Adjusted assets
Adjusted equity ratio
Cash flow adjustment, % of Revenue
Book value of equity, $M
Shares outstanding, mln
Market capitalization, $bln 244.2

 

FINANCIAL STATEMENTS FORECAST and PRESENT VALUE CALCULATION

Fiscal year
   2
   3
   4
   5
   6
   7
   8
   9
   10
   11
   12
   13
   14
   15
   16
   17
   18
   19
   20
   21
   22
   23
   24
   25
   26
   27
   28
   29
   30
   31

INCOME STATEMENT

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue growth rate, %
  4.40
  4.46
  4.51
  4.56
  4.61
  4.65
  4.68
  4.71
  4.74
  4.77
  4.79
  4.81
  4.83
  4.85
  4.86
  4.88
  4.89
  4.90
  4.91
  4.92
  4.93
  4.93
  4.94
  4.95
  4.95
  4.96
  4.96
  4.97
  4.97
  4.97
Revenue, $m
  105,344
  110,042
  115,009
  120,257
  125,796
  131,640
  137,803
  144,297
  151,140
  158,345
  165,931
  173,915
  182,316
  191,154
  200,449
  210,224
  220,502
  231,306
  242,663
  254,600
  267,144
  280,326
  294,176
  308,729
  324,017
  340,079
  356,951
  374,674
  393,290
  412,843
Variable operating expenses, $m
  84,370
  88,123
  92,091
  96,282
  100,707
  105,375
  110,297
  115,484
  120,949
  126,705
  132,537
  138,914
  145,624
  152,683
  160,108
  167,916
  176,125
  184,755
  193,826
  203,360
  213,380
  223,909
  234,972
  246,596
  258,807
  271,636
  285,113
  299,269
  314,138
  329,757
Fixed operating expenses, $m
  5,614
  5,737
  5,864
  5,993
  6,124
  6,259
  6,397
  6,538
  6,681
  6,828
  6,979
  7,132
  7,289
  7,449
  7,613
  7,781
  7,952
  8,127
  8,306
  8,488
  8,675
  8,866
  9,061
  9,260
  9,464
  9,672
  9,885
  10,103
  10,325
  10,552
Total operating expenses, $m
  89,984
  93,860
  97,955
  102,275
  106,831
  111,634
  116,694
  122,022
  127,630
  133,533
  139,516
  146,046
  152,913
  160,132
  167,721
  175,697
  184,077
  192,882
  202,132
  211,848
  222,055
  232,775
  244,033
  255,856
  268,271
  281,308
  294,998
  309,372
  324,463
  340,309
Operating income, $m
  15,360
  16,182
  17,055
  17,982
  18,965
  20,007
  21,109
  22,275
  23,509
  24,812
  26,416
  27,869
  29,403
  31,021
  32,728
  34,528
  36,425
  38,425
  40,531
  42,751
  45,089
  47,551
  50,143
  52,873
  55,746
  58,770
  61,953
  65,302
  68,827
  72,535
EBITDA, $m
  17,649
  18,563
  19,534
  20,563
  21,655
  22,811
  24,034
  25,327
  26,694
  28,139
  29,664
  31,273
  32,971
  34,763
  36,651
  38,642
  40,741
  42,952
  45,281
  47,734
  50,317
  53,038
  55,901
  58,915
  62,088
  65,426
  68,939
  72,636
  76,524
  80,615
Interest expense (income), $m
  924
  1,460
  1,393
  1,494
  1,600
  1,713
  1,831
  1,957
  2,089
  2,228
  2,375
  2,530
  2,692
  2,864
  3,044
  3,233
  3,433
  3,642
  3,863
  4,094
  4,338
  4,594
  4,863
  5,146
  5,443
  5,755
  6,083
  6,427
  6,789
  7,169
  7,569
Earnings before tax, $m
  13,900
  14,789
  15,562
  16,382
  17,253
  18,175
  19,152
  20,186
  21,280
  22,437
  23,886
  25,177
  26,539
  27,978
  29,495
  31,095
  32,783
  34,562
  36,437
  38,413
  40,495
  42,688
  44,998
  47,430
  49,991
  52,687
  55,526
  58,513
  61,657
  64,966
Tax expense, $m
  3,753
  3,993
  4,202
  4,423
  4,658
  4,907
  5,171
  5,450
  5,746
  6,058
  6,449
  6,798
  7,166
  7,554
  7,964
  8,396
  8,851
  9,332
  9,838
  10,371
  10,934
  11,526
  12,149
  12,806
  13,498
  14,226
  14,992
  15,799
  16,647
  17,541
Net income, $m
  10,147
  10,796
  11,360
  11,959
  12,594
  13,268
  13,981
  14,736
  15,535
  16,379
  17,437
  18,379
  19,374
  20,424
  21,531
  22,700
  23,931
  25,230
  26,599
  28,041
  29,561
  31,162
  32,848
  34,624
  36,493
  38,462
  40,534
  42,715
  45,010
  47,425

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total assets, $m
  46,489
  48,562
  50,754
  53,070
  55,515
  58,094
  60,813
  63,679
  66,699
  69,879
  73,226
  76,750
  80,457
  84,357
  88,460
  92,773
  97,309
  102,077
  107,089
  112,356
  117,892
  123,710
  129,822
  136,244
  142,991
  150,079
  157,525
  165,346
  173,561
  182,190
Adjusted assets (=assets-cash), $m
  46,489
  48,562
  50,754
  53,070
  55,515
  58,094
  60,813
  63,679
  66,699
  69,879
  73,226
  76,750
  80,457
  84,357
  88,460
  92,773
  97,309
  102,077
  107,089
  112,356
  117,892
  123,710
  129,822
  136,244
  142,991
  150,079
  157,525
  165,346
  173,561
  182,190
Revenue / Adjusted assets
  2.266
  2.266
  2.266
  2.266
  2.266
  2.266
  2.266
  2.266
  2.266
  2.266
  2.266
  2.266
  2.266
  2.266
  2.266
  2.266
  2.266
  2.266
  2.266
  2.266
  2.266
  2.266
  2.266
  2.266
  2.266
  2.266
  2.266
  2.266
  2.266
  2.266
Average production assets, $m
  24,124
  25,200
  26,337
  27,539
  28,807
  30,146
  31,557
  33,044
  34,611
  36,261
  37,998
  39,827
  41,750
  43,774
  45,903
  48,141
  50,495
  52,969
  55,570
  58,303
  61,176
  64,195
  67,366
  70,699
  74,200
  77,878
  81,742
  85,800
  90,063
  94,541
Working capital, $m
  2,002
  2,091
  2,185
  2,285
  2,390
  2,501
  2,618
  2,742
  2,872
  3,009
  3,153
  3,304
  3,464
  3,632
  3,809
  3,994
  4,190
  4,395
  4,611
  4,837
  5,076
  5,326
  5,589
  5,866
  6,156
  6,461
  6,782
  7,119
  7,473
  7,844
Total debt, $m
  25,793
  27,659
  29,632
  31,716
  33,916
  36,237
  38,685
  41,264
  43,982
  46,844
  49,857
  53,028
  56,365
  59,875
  63,567
  67,449
  71,531
  75,822
  80,333
  85,074
  90,056
  95,292
  100,793
  106,573
  112,645
  119,024
  125,725
  132,764
  140,158
  147,924
Total liabilities, $m
  41,840
  43,706
  45,679
  47,763
  49,963
  52,284
  54,732
  57,311
  60,029
  62,891
  65,904
  69,075
  72,412
  75,922
  79,614
  83,496
  87,578
  91,869
  96,380
  101,121
  106,103
  111,339
  116,840
  122,620
  128,692
  135,071
  141,772
  148,811
  156,205
  163,971
Total equity, $m
  4,649
  4,856
  5,075
  5,307
  5,551
  5,809
  6,081
  6,368
  6,670
  6,988
  7,323
  7,675
  8,046
  8,436
  8,846
  9,277
  9,731
  10,208
  10,709
  11,236
  11,789
  12,371
  12,982
  13,624
  14,299
  15,008
  15,752
  16,535
  17,356
  18,219
Total liabilities and equity, $m
  46,489
  48,562
  50,754
  53,070
  55,514
  58,093
  60,813
  63,679
  66,699
  69,879
  73,227
  76,750
  80,458
  84,358
  88,460
  92,773
  97,309
  102,077
  107,089
  112,357
  117,892
  123,710
  129,822
  136,244
  142,991
  150,079
  157,524
  165,346
  173,561
  182,190
Debt-to-equity ratio
  5.550
  5.700
  5.840
  5.980
  6.110
  6.240
  6.360
  6.480
  6.590
  6.700
  6.810
  6.910
  7.010
  7.100
  7.190
  7.270
  7.350
  7.430
  7.500
  7.570
  7.640
  7.700
  7.760
  7.820
  7.880
  7.930
  7.980
  8.030
  8.080
  8.120
Adjusted equity ratio
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  10,147
  10,796
  11,360
  11,959
  12,594
  13,268
  13,981
  14,736
  15,535
  16,379
  17,437
  18,379
  19,374
  20,424
  21,531
  22,700
  23,931
  25,230
  26,599
  28,041
  29,561
  31,162
  32,848
  34,624
  36,493
  38,462
  40,534
  42,715
  45,010
  47,425
Depreciation, amort., depletion, $m
  2,289
  2,381
  2,479
  2,581
  2,690
  2,804
  2,925
  3,052
  3,186
  3,327
  3,248
  3,404
  3,568
  3,741
  3,923
  4,115
  4,316
  4,527
  4,750
  4,983
  5,229
  5,487
  5,758
  6,043
  6,342
  6,656
  6,986
  7,333
  7,698
  8,080
Funds from operations, $m
  12,436
  13,177
  13,838
  14,540
  15,284
  16,072
  16,906
  17,788
  18,720
  19,706
  20,685
  21,783
  22,942
  24,165
  25,455
  26,814
  28,247
  29,757
  31,349
  33,025
  34,790
  36,649
  38,606
  40,666
  42,835
  45,118
  47,520
  50,048
  52,708
  55,506
Change in working capital, $m
  84
  89
  94
  100
  105
  111
  117
  123
  130
  137
  144
  152
  160
  168
  177
  186
  195
  205
  216
  227
  238
  250
  263
  276
  290
  305
  321
  337
  354
  372
Cash from operations, $m
  12,352
  13,088
  13,744
  14,440
  15,179
  15,961
  16,789
  17,664
  18,590
  19,569
  20,541
  21,631
  22,783
  23,997
  25,278
  26,628
  28,052
  29,552
  31,133
  32,798
  34,552
  36,398
  38,343
  40,390
  42,545
  44,813
  47,200
  49,711
  52,354
  55,134
Maintenance CAPEX, $m
  -1,973
  -2,062
  -2,154
  -2,251
  -2,354
  -2,462
  -2,577
  -2,697
  -2,824
  -2,958
  -3,099
  -3,248
  -3,404
  -3,568
  -3,741
  -3,923
  -4,115
  -4,316
  -4,527
  -4,750
  -4,983
  -5,229
  -5,487
  -5,758
  -6,043
  -6,342
  -6,656
  -6,986
  -7,333
  -7,698
New CAPEX, $m
  -1,037
  -1,076
  -1,138
  -1,202
  -1,269
  -1,338
  -1,411
  -1,487
  -1,567
  -1,650
  -1,737
  -1,828
  -1,924
  -2,024
  -2,129
  -2,238
  -2,354
  -2,474
  -2,601
  -2,733
  -2,873
  -3,019
  -3,172
  -3,332
  -3,501
  -3,678
  -3,864
  -4,059
  -4,263
  -4,478
Cash from investing activities, $m
  -3,010
  -3,138
  -3,292
  -3,453
  -3,623
  -3,800
  -3,988
  -4,184
  -4,391
  -4,608
  -4,836
  -5,076
  -5,328
  -5,592
  -5,870
  -6,161
  -6,469
  -6,790
  -7,128
  -7,483
  -7,856
  -8,248
  -8,659
  -9,090
  -9,544
  -10,020
  -10,520
  -11,045
  -11,596
  -12,176
Free cash flow, $m
  9,342
  9,950
  10,453
  10,988
  11,556
  12,160
  12,801
  13,480
  14,199
  14,960
  15,704
  16,555
  17,455
  18,405
  19,408
  20,467
  21,584
  22,762
  24,005
  25,315
  26,696
  28,151
  29,684
  31,300
  33,001
  34,793
  36,680
  38,666
  40,757
  42,959
Issuance/(repayment) of debt, $m
  -1,235
  1,866
  1,973
  2,084
  2,200
  2,321
  2,448
  2,580
  2,718
  2,862
  3,013
  3,171
  3,337
  3,510
  3,692
  3,882
  4,082
  4,291
  4,511
  4,741
  4,982
  5,235
  5,501
  5,780
  6,072
  6,379
  6,701
  7,039
  7,394
  7,766
Issuance/(repurchase) of shares, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash from financing (excl. dividends), $m  
  -1,235
  1,866
  1,973
  2,084
  2,200
  2,321
  2,448
  2,580
  2,718
  2,862
  3,013
  3,171
  3,337
  3,510
  3,692
  3,882
  4,082
  4,291
  4,511
  4,741
  4,982
  5,235
  5,501
  5,780
  6,072
  6,379
  6,701
  7,039
  7,394
  7,766
Total cash flow (excl. dividends), $m
  8,107
  11,816
  12,426
  13,072
  13,757
  14,482
  15,249
  16,060
  16,917
  17,822
  18,717
  19,726
  20,791
  21,915
  23,100
  24,349
  25,666
  27,053
  28,515
  30,056
  31,678
  33,386
  35,185
  37,079
  39,073
  41,172
  43,381
  45,705
  48,151
  50,725
Retained Cash Flow (-), $m
  -3,195
  -207
  -219
  -232
  -244
  -258
  -272
  -287
  -302
  -318
  -335
  -352
  -371
  -390
  -410
  -431
  -454
  -477
  -501
  -527
  -554
  -582
  -611
  -642
  -675
  -709
  -745
  -782
  -822
  -863
Prev. year cash balance distribution, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash flow adjustment, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash available for distribution, $m
  4,912
  11,609
  12,206
  12,840
  13,512
  14,224
  14,977
  15,773
  16,615
  17,504
  18,382
  19,374
  20,421
  21,525
  22,690
  23,918
  25,212
  26,577
  28,014
  29,529
  31,124
  32,805
  34,574
  36,437
  38,399
  40,463
  42,636
  44,923
  47,330
  49,862
Discount rate, %
  7.80
  8.19
  8.60
  9.03
  9.48
  9.95
  10.45
  10.98
  11.52
  12.10
  12.71
  13.34
  14.01
  14.71
  15.44
  16.22
  17.03
  17.88
  18.77
  19.71
  20.70
  21.73
  22.82
  23.96
  25.16
  26.41
  27.73
  29.12
  30.58
  32.11
PV of cash for distribution, $m
  4,556
  9,918
  9,530
  9,087
  8,591
  8,049
  7,468
  6,856
  6,226
  5,586
  4,932
  4,311
  3,715
  3,152
  2,632
  2,160
  1,741
  1,376
  1,066
  808
  599
  434
  306
  210
  141
  91
  57
  35
  21
  12
Current shareholders' claim on cash, %
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0

The Home Depot, Inc. (The Home Depot) is a home improvement retailer. The Company sells an assortment of building materials, home improvement products, and lawn and garden products, and provides various services. The Home Depot stores serves three primary customer groups: do-it-yourself (DIY) customers, do-it-for-me (DIFM) customers and professional customers. Its DIY customers are home owners purchasing products and completing their own projects and installations. The Company assists these customers with specific product and installation questions both in its stores and through online resources and other media designed to provide product and project knowledge. Its DIFM customers are home owners purchasing materials themselves and hiring third parties to complete the project or installation. Professional Customers are primarily professional renovators/remodelers, general contractors, repairmen, installers, small business owners and tradesmen.

FINANCIAL RATIOS  of  Home Depot (HD)

Valuation Ratios
P/E Ratio 32
Price to Sales 2.7
Price to Book 58.8
Price to Tangible Book
Price to Cash Flow 26
Price to Free Cash Flow 31.2
Growth Rates
Sales Growth Rate 6.9%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 7.9%
Cap. Spend. - 3 Yr. Gr. Rate 3.1%
Financial Strength
Quick Ratio 2
Current Ratio 0
LT Debt to Equity 515.8%
Total Debt to Equity 544.7%
Interest Coverage 15
Management Effectiveness
Return On Assets 20.1%
Ret/ On Assets - 3 Yr. Avg. 18.5%
Return On Total Capital 28.7%
Ret/ On T. Cap. - 3 Yr. Avg. 26.1%
Return On Equity 149.4%
Return On Equity - 3 Yr. Avg. 99.1%
Asset Turnover 2.2
Profitability Ratios
Gross Margin 34.2%
Gross Margin - 3 Yr. Avg. 34.2%
EBITDA Margin 16.3%
EBITDA Margin - 3 Yr. Avg. 15.6%
Operating Margin 14.2%
Oper. Margin - 3 Yr. Avg. 13.4%
Pre-Tax Margin 13.2%
Pre-Tax Margin - 3 Yr. Avg. 12.5%
Net Profit Margin 8.4%
Net Profit Margin - 3 Yr. Avg. 8%
Effective Tax Rate 36.3%
Eff/ Tax Rate - 3 Yr. Avg. 36.4%
Payout Ratio 42.8%

HD stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the HD stock intrinsic value calculation we used $100904 million for the last fiscal year's total revenue generated by Home Depot. The default revenue input number comes from 0001 income statement of Home Depot. You may change it if you feel that it should be adjusted for some unusual circumstances that are not expected to be repeated in the future or if you already know (from interim financial statements, for example) that this year's revenue is going to be quite different.

Revenue growth rate. Forecasted future revenue growth rate is the most important input parameter for the intrinsic value calculation. Unlike other input parameters that are reasonably expected to be in line with their historic averages or their historic trends, the revenue growth rate by and large is a wild card: nobody really knows what the company's revenue will be in the future. Of course, the level of unpredictability is different for different industries (utility companies being the most predictable and, thus, less risky).
    We use three input parameters to forecast the revenue growth rate in our HD stock valuation model: a) initial revenue growth rate of 4.4% whose default value is the revenue growth rate in the most recent quarter compared to the quarterly revenue a year ago; b) terminal revenue growth rate of 5% whose default value is chosen to be close to the average nominal (i.e. not adjusted for inflation) GDP growth rate; and c) revenue decline factor of 0.9, which stipulates that revenue growth rate in each forecasted year will be equal to the difference of the revenue growth rate in the preceding year and the terminal revenue growth rate multiplied by this revenue decline factor (with the passage of time the revenue growth rate will be approaching the terminal revenue growth rate, but not quite reaching it - though the difference could be infinitesimally small).
    At the revenue decline factor of 1, the future revenue growth rate is forecasted to be constant and equal to the initial revenue growth rate. The smaller the revenue decline factor, the faster the revenue growth rate will approach the terminal revenue growth.

Discount rate. The discount rate is used for determining the present value of future cash flows: future cash flows are "discounted" as at normal conditions (that translate into positive expected return on investment) one dollar today is worth more than the same dollar in the future. Unlike all other valuation models, we use variable discount rate, i.e. it increases for each consecutive year. This is done to account for higher risk of cash flows coming in further in the future.
    The initial discount rate of 7.8%, whose default value for HD is calculated based on our internal credit rating of Home Depot, is applied to the cash flow expected to be received a year from now (well, actually, to be precise, in the financial year following the base year - the last year for which we have financial statements). For each consecutive year the discount rate is multiplied by the discount rate multiplier of 1.05, e.i. each year it increases by 5%. Feel free to change this number to correspond to your level of risk assessment of Home Depot.
    By the way, it is easy to set the discount rate to be constant (this would make comparison with other valuation models easier): just set the discount rate multiplier equal to 1 and chose the magnitude of the initial discount rate to your liking.

Variable cost ratio is the ratio of variable costs (i.e. costs that fluctuate with fluctuation of the volume of production) to the revenue expressed as a percentage. In the calculation of intrinsic value of HD stock the variable cost ratio is equal to 80.1%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $5493 million in the base year in the intrinsic value calculation for HD stock. These expenses increase with the level of inflation in subsequent years.

Interest rate on debt is the average all-in rate of interest paid by the company on its debt. It is set at 5.4% for Home Depot.

Corporate tax rate of 27% is the nominal tax rate for Home Depot. In reality, companies find ways to pay much less taxes than that or not to pay them at all.

Cash flow adjustment could be used for any adjustment the investor deems necessary. Most commonly we use this field to account for stock options-related effects in excess of what is reported on the company's income statement. The cash flow adjustment is expressed as a percentage of the revenue, and in the current valuation of the HD stock is equal to 0%.

Production assets are the company's assets used for manufacturing products or provision of services. In the valuation model input table they are expressed as a percentage of revenue and for HD are equal to 22.9%.

Life of production assets of 11.7 years is the average useful life of capital assets used in Home Depot operations. It is used to calculate yearly capital expenditures needed to keep these assets in good order - we call it the maintenance CAPEX.

Working capital is the difference between the company's current assets and liabilities. In the model we use the ratio of working capital to revenue, which for HD is equal to 1.9%. A negative number means that the company is apt at using financial resources of its suppliers and customers; a large positive number, on the other hand, means that it either provides in-kind financing to others or is not good at managing its inventories.

Book value of equity - $1454 million for Home Depot - is used in calculation of the "floor" for intrinsic valuation based on the discounted cash flow (DCF) method. Even if the prospects are very bad for a company, its assets could always be sold now for their current fair market value.

Shares outstanding of 1153.54 million for Home Depot is needed to calculate the intrinsic value of one share.

Market capitalization is used here only for reference purposes and as a quick check that the share price and the number of shares outstanding numbers are correct - something especially to be cognizant about at stock splits. So, the market capitalization of Home Depot at the current share price and the inputted number of shares is $244.2 billion.

RELATED COMPANIES Price Int.Val. Rating
LOW Lowe's 116.26 54.43  sell
SHOS Sears Hometown 3.25 1.93  hold

COMPANY NEWS

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▶ Exclusive: Home Depot in the market for more Houston industrial space   [Aug-28-18 03:37PM  American City Business Journals]
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