Sells building materials and home improvement products to consumers and to professional contractors.
Home Depot (HD) scores 6.4 out of 10 as of , computed from its reported financial statements. That reads as solid quality. The reading rests on predictability, and growth is what holds it back.
Data provided by Twelve Data. Scores are computed by Lemma Analysis from reported financials.
We cannot judge Home Depot yet, because fewer than five years had both a return on capital and a cost of capital we could measure. This is not a “no”.
Quantitative signs of a moat, read from the filed statements. This is not a judgement of where it comes from (brand, network effects, switching costs). How Lemma measures a moat →
Returns on capital here are among the highest in retail, partly because years of buybacks have left very little equity in the business, a distortion that a solvency reading catches and a headline profitability figure does not. Demand tracks housing turnover and mortgage rates, so predictability is doing real work in this score. Together the pillars describe a well-run operator with a cyclical top line.
On the filings behind it, Home Depot earns 6.4 out of 10 for business quality as of October 17, 2026. That is solid quality on our scale. A solid reading is a respectable business with clear strengths and at least one area that falls short of the best in its field. The figure is a weighted average of five pillars, each scored from 0 to 10 against sector-aware benchmarks from reported statements.
Set against 179 Consumer Discretionary companies, Home Depot lands at the 79th percentile, among the stronger quarter of the group. For reference, the middle of the group scores 5.0 and a company needs 6.1 to reach its top quarter, which leaves Home Depot above the median.
Home Depot’s profitability score is 8.0 out of 10 (strong). Against a median of 5.1 among 176 Consumer Discretionary companies, that is well above the group and the 82nd percentile. High profitability means each unit of capital and of sales is turning into more profit than at most of its peers, which is usually the first sign of pricing power or a cost advantage.
On solvency, Home Depot scores 5.7, an average reading. Its peers have a median of 5.9 across 141 Consumer Discretionary companies, which places it in line with them, at the 47th percentile. Middling solvency says the balance sheet is neither a strength nor a constraint today.
On growth, Home Depot scores 2.7, a weak reading. Its peers have a median of 4.0 across 149 Consumer Discretionary companies, which places it below them, at the 32nd percentile. Weak growth means revenue and earnings have been flat or shrinking against peers, which can be cyclical or a sign of a market that is maturing.
Efficiency scores 6.4 out of 10, which reads as average. The median across 170 Consumer Discretionary companies is 6.2, so Home Depot is in line with its peers on this pillar and ranks at the 58th percentile. Middling efficiency is unremarkable on its own, though improvements here tend to show up in free cash flow first.
Predictability scores 8.6 out of 10, which reads as strong. The median across 178 Consumer Discretionary companies is 5.0, so Home Depot is well above its peers on this pillar and ranks at the 98th percentile. High predictability means the company’s results have moved steadily from year to year, which makes the other pillars more trustworthy as a guide.
This is a lopsided profile. Predictability scores 8.6 but growth only 2.7, a gap of 5.9 points, so the overall hides a business that is excellent in one respect and weak in another. A predictability lead means consistency is the business’s strongest trait, which makes its other readings easier to trust. A growth shortfall often comes with size or a maturing market, and is less of a concern if the other pillars are strong.
The pillar with the most room to move the score is growth. If it rose to the median of Consumer Discretionary companies, 4.0, Home Depot’s overall score would go from 6.4 to about 6.7. All five pillars could be scored, so the overall uses the full set of weights out of 100: profitability 25, solvency 20, growth 20, efficiency 15, predictability 20.
These are the Consumer Discretionary companies closest to Home Depot in market value. Each has its own page scored on the same five pillars, so the comparison is like for like.
How much profit the company generates from its capital and sales.
The company’s ability to service debt and meet its obligations.
How fast revenue, earnings and cash flow are compounding.
How well assets and earnings convert into cash and output.
How stable and consistent results have been over time.
Each metric is scored from 0 to 10 against sector-aware benchmarks, where higher is better. Metrics roll up into five pillars, and the pillars combine into the overall score using the weights shown. Sector-sensitive metrics are judged relative to peers in the same sector.
This score is a systematic, backward-looking read of reported fundamentals. It does not judge valuation, management quality, competitive moat, or future prospects, and can be distorted by one-off items or unusual accounting. Treat it as a starting point, not a recommendation.
Educational only. Not investment advice.
On this reading Home Depot scores 6.4 out of 10, which reads as solid quality. Its strongest pillar is predictability, its weakest is growth. Quality is not the same as a good investment: the score says nothing about the price you would pay.
Home Depot ranks at the 79th percentile of the 179 Consumer Discretionary companies Lemma publishes a score for. The median there is 5.0 and the top quarter starts at 6.1, against Home Depot’s 6.4.
Five pillars, each scored from 0 to 10 against sector-aware benchmarks and then weighted into one overall reading: profitability, solvency, growth, efficiency and predictability. Everything comes from reported financials, and nothing comes from price, sentiment or forecasts.
This page last changed on October 17, 2026. The score moves with the financial statements, so the page changes when a new filing moves the reading rather than on a schedule. Live figures for HD are in the app.
No. Quality and valuation are separate questions, and a good business at the wrong price is still a bad purchase. Score the business here, then price it with a DCF you control.
Inside Lemma Analysis the same five pillars run on every company we cover, with the metrics behind each one, current fundamentals, a DCF you control and a watchlist that tells you when the price catches up.
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