Interested In The Home Depot Inc (NYSE:HD)? Here’s What Its Recent Performance Looks Like
Assessing The Home Depot Inc’s (NYSE:HD) past track record of performance is an insightful exercise for investors. It allows us to reflect on whether or not the company has met or exceed expectations, which is a great indicator for future performance. Today I will assess HD’s recent performance announced on 29 October 2017 and evaluate these figures to its long-term trend and industry movements. See our latest analysis for Home Depot
How Did HD’s Recent Performance Stack Up Against Its Past?
I look at the ‘latest twelve-month’ data, which annualizes the latest 6-month earnings release, or some times, the latest annual report is already the most recent financial data. This enables me to assess many different companies on a more comparable basis, using the most relevant data points. For Home Depot, its most recent earnings (trailing twelve month) is $8,595.0M, which compared to the previous year’s figure, has risen by 11.89%. Given that these figures may be somewhat short-term, I have created an annualized five-year value for HD’s net income, which stands at $5,784.5M. This means that, generally, Home Depot has been able to increasingly improve its net income over the last few years as well.
How has it been able to do this? Well, let’s take a look at whether it is only due to an industry uplift, or if Home Depot has seen some company-specific growth. Over the last couple of years, Home Depot expanded its bottom line faster than revenue by effectively controlling its costs. This resulted in a margin expansion and profitability over time. Inspecting growth from a sector-level, the US specialty retail industry has been growing, albeit, at a unexciting single-digit rate of 8.14% over the prior twelve months, and 5.98% over the past five. This means whatever tailwind the industry is benefiting from, Home Depot is able to leverage this to its advantage.
What does this mean?
Home Depot’s track record can be a valuable insight into its earnings performance, but it certainly doesn’t tell the whole story. While Home Depot has a good historical track record with positive growth and profitability, there’s no certainty that this will extrapolate into the future. I recommend you continue to research Home Depot to get a better picture of the stock by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for HD’s future growth? Take a look at our free research report of analyst consensus for HD’s outlook.
2. Financial Health: Is HD’s operations financially sustainable? Balance sheets can be hard to analyze, which is why we’ve done it for you. Check out our financial health checks here.
3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.
NB: Figures in this article are calculated using data from the trailing twelve months from 29 October 2017. This may not be consistent with full year annual report figures.
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned.
