Home Depot Inc. (HD)

Free Cash Flow to The Firm (FCFF)

Home Depot Inc., FCFF calculation

USD $ in millions

12 months ended	Feb 3, 2013	Jan 29, 2012	Jan 30, 2011	Jan 31, 2010	Feb 1, 2009	Feb 3, 2008
Net earnings	4,535	3,883	3,338	2,661	2,260	4,395
Net noncash charges	1,999	1,897	1,932	2,170	2,821	2,113
Changes in assets and liabilities, net of the effects of acquisitions and disposition	441	871	(685)	294	447	(781)
Net cash provided by operating activities	6,975	6,651	4,585	5,125	5,528	5,727
Cash payments made for interest, net of interest capitalized, net of tax	387	371	367	439	397	434
Capital expenditures, net of non-cash capital expenditures	(1,312)	(1,221)	(1,096)	(966)	(1,847)	(3,558)
Proceeds from sales of property and equipment	50	56	84	178	147	318
Non-cash capital expenditures	(98)	(25)	(62)	(10)	(37)	(19)
Free cash flow to the firm (FCFF)	6,002	5,832	3,878	4,766	4,188	2,902

Item	Description	The company
FCFF	Free cash flow to the firm is the cash flow available to the Home Depot Inc.'s suppliers of capital after all operating expenses have been paid and necessary investments in working and fixed capital have been made.	Home Depot Inc.'s FCFF increased from 2011 to 2012 and from 2012 to 2013.

Home Depot Inc., current EV/FCFF

	Home Depot Inc.	Consumer Services
Selected Financial Data (USD $ in millions)
Enterprise value (EV)	122,479
Free cash flow to the firm (FCFF)	6,002
Ratio
EV/FCFF	20.40	23.56

If company EV/FCFF is lower then the EV/FCFF of benchmark then company is relatively undervalued.

Otherwise, if company EV/FCFF is higher then the EV/FCFF of benchmark then company is relatively overvalued.

Home Depot Inc., EV/FCFF calculation

	Feb 3, 2013	Jan 29, 2012	Jan 30, 2011	Jan 31, 2010	Feb 1, 2009	Feb 3, 2008
Selected Financial Data (USD $ in millions)
Enterprise value (EV)¹	111,961	84,477	69,805	63,498	52,932	62,368
Free cash flow to the firm (FCFF)²	6,002	5,832	3,878	4,766	4,188	2,902
EV/FCFF, Comparison to Industry
Home Depot Inc.³	18.65	14.48	18.00	13.32	12.64	21.49
Industry, Consumer Services	–	19.62	17.41	15.21	18.43	22.47

2013 Calculations

³ EV/FCFF = EV ÷ FCFF
= 111,961 ÷ 6,002 = 18.65

Ratio	Description	The company
EV/FCFF	Enterprise value to free cash flow to the firm is whole company valuation indicator.	Home Depot Inc.'s EV/FCFF ratio declined from 2011 to 2012 but then increased from 2012 to 2013 exceeding 2011 level.