Home Depot Inc. (HD)

Free Cash Flow to Equity (FCFE)

Home Depot Inc., FCFE 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
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
Proceeds from (repayments of) short-term borrowings, net	–	–	–	–	(1,732)	1,734
Proceeds from long-term borrowings, net of discount	–	1,994	998	–	–	–
Repayments of long-term debt	(32)	(1,028)	(1,029)	(1,774)	(313)	(20)
Free cash flow to equity (FCFE)	5,681	6,452	3,542	2,563	1,783	4,201

Item	Description	The company
FCFE	Free cash flow to equity is the cash flow available to Home Depot Inc.'s equity holders after all operating expenses, interest, and principal payments have been paid and necessary investments in working and fixed capital have been made.	Home Depot Inc.'s FCFE increased from 2011 to 2012 but then slightly declined from 2012 to 2013.

Home Depot Inc., current P/FCFE

	Home Depot Inc.	Consumer Services
No. shares of common stock outstanding	1,485,517,485
Selected Financial Data (USD $)
Free cash flow to equity (FCFE) (in millions)	5,681
FCFE per share	3.82
Current share price (P)	78.71
Ratio
P/FCFE	20.58	17.69

If company P/FCFE is lower then the P/FCFE of benchmark then company is relatively undervalued.

Otherwise, if company P/FCFE is higher then the P/FCFE of benchmark then company is relatively overvalued.

Home Depot Inc., P/FCFE calculation

	Feb 3, 2013	Jan 29, 2012	Jan 30, 2011	Jan 31, 2010	Feb 1, 2009	Feb 3, 2008
No. shares of common stock outstanding¹	1,485,517,485	1,523,263,533	1,622,070,458	1,693,341,736	1,696,279,008	1,690,034,627
Selected Financial Data (USD $)
Free cash flow to equity (FCFE) (in millions)²	5,681	6,452	3,542	2,563	1,783	4,201
FCFE per share⁴	3.82	4.24	2.18	1.51	1.05	2.49
Share price^1, 3	69.78	49.68	37.36	32.62	24.77	29.22
P/FCFE, Comparison to Industry
Home Depot Inc.⁵	18.25	11.73	17.11	21.55	23.57	11.76
Industry, Consumer Services	–	14.26	12.05	16.84	26.93	11.15

¹ Data adjusted for splits and stock dividends.

³ Close price on the filing date of Home Depot Inc.'s Annual Report.

2013 Calculations

⁴ FCFE per share = FCFE ÷ No. shares of common stock outstanding
5,681,000,000 ÷ 1,485,517,485 = 3.82

⁵ P/FCFE = Share price ÷ FCFE per share
= 69.78 ÷ 3.82 = 18.25

Ratio	Description	The company
P/FCFE	Price to free cash flow to equity is cash valuation indicator of stockholders' equity.	Home Depot Inc.'s P/FCFE ratio declined from 2011 to 2012 but then increased from 2012 to 2013 exceeding 2011 level.