Topic: How To Invest

Q: Pat: Could I get your view on Home Depot—whether this is a good buy and why? Thanks.

Article Excerpt

A: Home Depot Inc., $185.98, symbol HD on New York (Shares outstanding: 1.1 billion; Market cap: $206.6 billion; www.homedepot.com), operates warehouse-style home-improvement stores that average 104,000 square feet, plus an additional 24,000 square-foot garden centre. Each outlet typically carries 30,000 to 40,000 items. The company has 2,286 stores with locations in every state of the U.S., 10 Canadian provinces, Mexico, Puerto Rico, the U.S. Virgin Islands, and Guam. Home Depot’s sales have risen steadily over the last five years—up 28.0% from $78.8 billion in 2014 to $100.9 billion in 2018 (fiscal years end January 31). Earnings have also risen steadily—up 64.0%, from $5.4 billion in 2013 to $8.8 billion in 2018. As the result of share buybacks, per-share earnings rose 98.4% over the same five years, from $3.76 to $7.46 on fewer shares outstanding. The company plans to spend $1.2 billion over the next five years to speed up delivery of goods to homes and job sites as online shopping continues to expand…