Home Depot Inc: Delivering Both Income & Growth to Investors

 

Why Home Depot Stock Could Be Special

 



In an era when e-commerce stocks are all the rage, who would have thought that a company known for its big box stores would see its share price shoot through the roof?

 

But it is happening: shares of Home Depot Inc (NYSE:HD) have surged by 138% over the past five years. And that figure doesn’t include the additional returns that shareholders have collected through the company’s rising dividend payments.

 

Home Depot is the largest home improvement retailer in the world. The company was founded in 1978 and opened its first two stores in June 1979. Today, it operates approximately 2,300 stores in all 50 U.S. states, the District of Columbia, Puerto Rico, the U.S. Virgin Islands, Guam, all 10 Canadian provinces, and Mexico.

 

In its current configuration, a typical Home Depot store averages at about 105,000 square feet of indoor retail space, which dwarfs most of its competitors. But we know that brick-and-mortar retailers have suffered from the rise of the e-commerce industry. So, how has Home Depot’s business been lately?

 

Surprisingly well. In the company’s fiscal year 2020, which ended January 31, 2021, it generated $132.1 billion in total sales, representing a 19.9% increase year-over-year.

 

 

The company’s comparable sales, a critical measure of a retailer’s performance, increased by 19.7% in fiscal 2020. Notably, its comparable sales in the U.S. rose by 20.6%.

 

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