Aureus
DWarning

Home Depot, Inc. (The)(HD)

D

Financial data as of Jan 31, 2026Declining · Consumer Discretionary

FCF Margin7.7%Free Cash Flow / Revenue
Cash Conversion115.3%Operating CF / Net Income
Free Cash Flow$12.6B
Revenue$164.7B
Net Cash-$64.0BNet debt position
Debt / FCF5.2xElevated debt burden
Current Ratio1.06Adequate short-term liquidity
YoY FCF Growth-35.9%5 of 5 quarters positive

How This Grade Was Calculated

Base grade from FCF margin, adjusted by financial health factors

BaseC
→
-0.5Elevated debt-to-FCF ratio (5.2x)
→
-1Significant YoY FCF decline (-35.9%)
→
+0.5Highly consistent quarterly FCF
→
FinalD

Analysis Summary

Strengths

  • Excellent cash conversion (115%)
  • Highly consistent quarterly FCF

Concerns

  • Low FCF margin (7.7%)
  • Heavy debt position ($64.0B net debt, 5.2x FCF)
  • High debt-to-FCF ratio (5.2x)
  • Significant YoY FCF decline (-35.9%)

Financial Breakdown

Key financials compared side by side

Margin Composition

FCF Margin7.7%
Net Margin8.6%
Operating CF Margin9.9%
CapEx Ratio2.2%

Balance Sheet Health

Debt, liquidity, and leverage snapshot

Net Cash-$64.0BNet debt position
Debt / FCF5.2xElevated debt burden
Current Ratio1.06Adequate liquidity
Debt / Equity5.10High leverage

Quarterly FCF Trend

-35.9% YoYDeclining (-35.9%)

Free cash flow per quarter

Sector Comparison — Consumer Discretionary

FCF Margin ranked against sector peers

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Detailed Metrics

Company NameHome Depot, Inc. (The)
SectorConsumer Discretionary
Free Cash Flow$12.6B
Revenue$164.7B
Net Income$14.2B
Operating Cash Flow$16.3B
Capital Expenditure$3.7B
FCF Margin7.7%
Cash Conversion Rate115.3%
Net Margin8.6%
Total Debt$65.3B
Total Cash$1.4B
Net Cash-$64.0B
Current Ratio1.06
Debt / Equity5.10
Debt / FCF5.2x
YoY FCF Growth-35.9%
Positive Quarters5 of 5
Trend DirectionDeclining
Report DateJan 31, 2026
GradeD
Data SourceYahoo Finance

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Consumer Discretionary: Eight A-Grades, Six Failures

Travel and fast food print 30%+ FCF margins. Auto and retail burn cash. Same sector, different planets.

Mar 27, 2026
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