Home Depot Inc. (HD) | Debt and Solvency

Ratios (Summary)

Home Depot Inc., debt and solvency ratios

	Feb 3, 2013	Jan 29, 2012	Jan 30, 2011	Jan 31, 2010	Feb 1, 2009	Feb 3, 2008
Debt to equity	0.61	0.60	0.52	0.50	0.64	0.76
Debt to capital	0.38	0.38	0.34	0.33	0.39	0.43
Interest coverage	12.43	11.01	10.95	6.95	6.67	10.78

Source: Based on data from Home Depot Inc. Annual Reports

Ratio	Description	The company
Debt-to-equity ratio	A solvency ratio calculated as total debt divided by total shareholders' equity.	Home Depot Inc.'s debt-to-equity ratio deteriorated from 2011 to 2012 and from 2012 to 2013.
Debt-to-capital ratio	A solvency ratio calculated as total debt divided by total debt plus shareholders' equity.	Home Depot Inc.'s debt-to-capital ratio deteriorated from 2011 to 2012 and from 2012 to 2013.
Interest coverage ratio	A solvency ratio calculated as EBIT divided by interest payments.	Home Depot Inc.'s interest coverage ratio improved from 2011 to 2012 and from 2012 to 2013.

	Feb 3, 2013	Jan 29, 2012	Jan 30, 2011	Jan 31, 2010	Feb 1, 2009	Feb 3, 2008
Selected Financial Data (USD $ in millions)
Short-term debt	–	–	–	–	–	1,747
Current installments of long-term debt	1,321	30	1,042	1,020	1,767	300
Long-term debt, excluding current installments	9,475	10,758	8,707	8,662	9,667	11,383
Total debt	10,796	10,788	9,749	9,682	11,434	13,430
Stockholders’ equity	17,777	17,898	18,889	19,393	17,777	17,714
Debt to Equity, Comparison to Industry
Home Depot Inc.¹	0.61	0.60	0.52	0.50	0.64	0.76
Industry, Consumer Services	–	0.59	0.56	0.49	0.54	0.66

Source: Based on data from Home Depot Inc. Annual Reports

2013 Calculations

¹ Debt to equity = Total debt ÷ Stockholders’ equity
= 10,796 ÷ 17,777 = 0.61

Ratio	Description	The company
Debt-to-equity ratio	A solvency ratio calculated as total debt divided by total shareholders' equity.	Home Depot Inc.'s debt-to-equity ratio deteriorated from 2011 to 2012 and from 2012 to 2013.

	Feb 3, 2013	Jan 29, 2012	Jan 30, 2011	Jan 31, 2010	Feb 1, 2009	Feb 3, 2008
Selected Financial Data (USD $ in millions)
Short-term debt	–	–	–	–	–	1,747
Current installments of long-term debt	1,321	30	1,042	1,020	1,767	300
Long-term debt, excluding current installments	9,475	10,758	8,707	8,662	9,667	11,383
Total debt	10,796	10,788	9,749	9,682	11,434	13,430
Stockholders’ equity	17,777	17,898	18,889	19,393	17,777	17,714
Total capital	28,573	28,686	28,638	29,075	29,211	31,144
Debt to Capital, Comparison to Industry
Home Depot Inc.¹	0.38	0.38	0.34	0.33	0.39	0.43
Industry, Consumer Services	–	0.37	0.36	0.33	0.35	0.40

Source: Based on data from Home Depot Inc. Annual Reports

2013 Calculations

¹ Debt to capital = Total debt ÷ Total capital
= 10,796 ÷ 28,573 = 0.38

Ratio	Description	The company
Debt-to-capital ratio	A solvency ratio calculated as total debt divided by total debt plus shareholders' equity.	Home Depot Inc.'s debt-to-capital ratio deteriorated from 2011 to 2012 and from 2012 to 2013.

	Feb 3, 2013	Jan 29, 2012	Jan 30, 2011	Jan 31, 2010	Feb 1, 2009	Feb 3, 2008
Selected Financial Data (USD $ in millions)
Net earnings	4,535	3,883	3,338	2,661	2,260	4,395
Add: Interest expense	632	606	530	676	624	696
Add: Income tax expense (benefit)	2,686	2,185	1,935	1,362	1,278	2,410
Earnings before interest and tax (EBIT)	7,853	6,674	5,803	4,699	4,162	7,501
Interest Coverage, Comparison to Industry
Home Depot Inc.¹	12.43	11.01	10.95	6.95	6.67	10.78
Industry, Consumer Services	–	10.71	11.03	9.88	9.07	6.02

Source: Based on data from Home Depot Inc. Annual Reports

2013 Calculations

¹ Interest coverage = EBIT ÷ Interest expense
= 7,853 ÷ 632 = 12.43

Ratio	Description	The company
Interest coverage ratio	A solvency ratio calculated as EBIT divided by interest payments.	Home Depot Inc.'s interest coverage ratio improved from 2011 to 2012 and from 2012 to 2013.