Home Depot Inc. (NYSE:HD)

The analysis of the property, plant, and equipment data reveals consistent growth across most asset categories over the six-year period. The land asset base shows gradual appreciation, increasing from 8,390 million US dollars in early 2020 to 9,060 million US dollars by early 2025. This steady growth indicates ongoing investment or acquisition in land holdings.

Buildings and improvements have also experienced a steady rise, growing from 18,432 million to 20,260 million US dollars. This suggests continued enhancement or expansion of physical store infrastructure.

Furniture, fixtures and equipment demonstrate a notable upward trajectory, increasing significantly from 13,666 million in 2020 to 18,474 million in 2025. This category shows the most pronounced absolute increase, indicating notable investment in store fixtures and equipment over the period.

Leasehold improvements increase consistently, rising from 1,789 million to 2,423 million US dollars, which aligns with ongoing renovations or customization of leased properties. Construction in progress exhibits some fluctuation; it rises from 1,005 million to a peak of 1,297 million in 2023, dips slightly to 1,192 million in 2024, then rebounds notably to 1,521 million in 2025. This pattern may reflect project timing or shifts in investment strategy.

The finance leases category shows significant growth initially from 1,578 million to 4,135 million by early 2023, then stabilizes with a slight decline, settling at 4,045 million in 2025. This trend suggests increased leasing activity up to 2023, followed by a plateau or minor reduction in new lease commitments.

Total property and equipment at cost show a consistent upward trend from 44,860 million to 55,783 million over the period, marking an overall increase of approximately 24.4%. This reinforces the pattern of sustained capital investment.

Accumulated depreciation and finance lease amortization increase steadily in absolute terms (negative values w.r.t. asset cost), from -22,090 million to -29,081 million, indicating regular depreciation recognition in line with asset aging and usage.

Consequently, net property and equipment, representing the carrying value after depreciation, rise from 22,770 million in 2020 to 26,702 million in 2025. Though growth in net assets is positive, the rate is slower than gross asset growth due to accumulated depreciation impacts.

In summary, the data reflect steady investment and asset base expansion, particularly in equipment and building-related categories. Accumulated depreciation grows proportionally, and net asset values improve moderately, consistent with ongoing capital expenditures and asset utilization.

Average age ratio

The average age ratio displays a generally increasing trend over the periods observed. Beginning at 60.57% in early 2020, it experienced a slight decline to 59.85% in early 2021, then consistently rose to reach 62.24% by early 2025. This indicates a gradual aging of the property, plant, and equipment assets over the analyzed span.

Estimated total useful life

The estimated total useful life of the assets demonstrated minor fluctuations. Notably, it increased from 16 years in 2020 to 17 years in 2021, before returning to 16 years in 2022 and 2023. Subsequently, a decline is evident, dropping to 15 years in 2024 and further to 14 years in 2025. This suggests a reassessment or shortening of the expected service duration of these assets in recent years.

Estimated age, time elapsed since purchase

The estimated age of the assets remained relatively stable at 10 years for four consecutive periods, from 2020 through 2023. However, a decrease to 9 years is observed for the last two periods (2024 and 2025), which might indicate acquisitions of newer assets or reclassification affecting the average age calculation.

Estimated remaining life

The estimated remaining life of the assets showed minor variation, starting at 6 years in 2020, rising to 7 years in 2021, and then returning to 6 years in the subsequent two years. In 2024, it remained at 6 years before declining slightly to 5 years in 2025. This reflects modest adjustments in the anticipated remaining usability of the assets over time.

The analysis of the property, plant, and equipment data reveals several noteworthy trends over the examined periods.

Accumulated Depreciation and Finance Lease Amortization

The accumulated depreciation and finance lease amortization exhibit a steady upward trajectory from 22,090 million US dollars in early 2020 to 29,081 million US dollars by early 2025. This increase indicates a continuous aging and usage of the asset base, reflecting consistent depreciation expenses recognized each year.

Property and Equipment, at Cost

The total cost of property and equipment rises progressively across the periods, starting at 44,860 million US dollars in 2020 and culminating at 55,783 million US dollars in 2025. This steady growth suggests ongoing capital expenditures to acquire or improve assets, supporting operational capacity expansion or asset replacement.

Land

The value attributed to land shows moderate growth, increasing from 8,390 million US dollars in 2020 to 9,060 million US dollars in 2025. The relative stability and slower growth of land value compared to total property and equipment cost may reflect lower acquisition frequency or more stable market valuations for land assets.

Average Age Ratio

The average age ratio, expressed as a percentage, remains fairly stable but demonstrates a subtle overall increase from 60.57% in 2020 to 62.24% in 2025. This gradual rise implies that the asset base is aging slightly, which could suggest slower asset replacement or an accumulation of older assets within the company's fixed asset portfolio.

Overall, the data indicate a company steadily investing in fixed assets, with accumulated depreciation rising correspondingly. The rising average age ratio signals that despite investments, there might be a mild aging trend in the existing asset base, warranting attention to asset renewal policies to maintain operational efficiency.

Property and Equipment, at Cost

The property and equipment value exhibited a consistent upward trajectory over the observed period. Starting at $44,860 million in early 2020, it increased steadily each year, reaching $55,783 million by early 2025. This represents an approximate cumulative increase of 24% over five years, indicating ongoing investments or acquisitions in fixed assets.

Land

Land holdings showed a more modest rise compared to the total property and equipment. The value increased from $8,390 million in 2020 to $9,060 million in 2025, marking an approximate 8% growth. The incremental increases were relatively small but consistent annually, reflecting gradual expansion or revaluation of land assets.

Depreciation and Finance Lease Amortization Expense

Depreciation and finance lease amortization expenses demonstrated a steady increase from $2,223 million in 2020 to $3,283 million in 2025. This 48% increase outpaces the growth in property and equipment cost, possibly indicating an aging asset base being depreciated more aggressively or increased utilization of leased assets subject to amortization.

Estimated Total Useful Life

The estimated total useful life of assets declined from 16 years in 2020 to 14 years in 2025. This downward trend suggests changes either in asset composition, with potentially shorter-lived assets being acquired, or revised estimates of asset longevity possibly due to technological advancements or changes in operational strategy.

Accumulated Depreciation and Finance Lease Amortization

The accumulated depreciation and finance lease amortization amount has demonstrated a consistent upward trend over the observed periods. Starting at $22,090 million in February 2020, it increased steadily to $29,081 million by February 2025. The incremental growth each year indicates ongoing depreciation of property, plant, and equipment assets, reflecting both aging assets and continued capitalization, subject to amortization.

Depreciation and Finance Lease Amortization Expense

The annual depreciation and finance lease amortization expense shows a continuous increase from $2,223 million in February 2020 to $3,283 million in February 2025. This steady rise suggests either an increase in asset base or changes in amortization schedules, contributing to higher annual expenses. The increment between periods has been relatively consistent, indicating systematic expense recognition practices.

Time Elapsed Since Purchase

The time elapsed since purchase was stable at 10 years from February 2020 through January 2023, followed by a decrease to 9 years in the final two reported periods. This change may reflect the addition of newer assets purchased more recently, thereby lowering the average age of the asset base. The reduction in average age aligns with the increasing depreciation expense, as newer assets typically contribute higher expenses initially.

Overall Insights

The data indicates a growing asset base that is being depreciated over time, with increasing annual depreciation expenses consistent with asset additions or changes in asset composition. The decrease in average asset age in the most recent years supports the hypothesis of new investments in property, plant, and equipment. Together, these patterns reveal active asset management with ongoing capital expenditures and systematic depreciation recognition.

Net Property and Equipment

The net property and equipment value demonstrated a consistent upward trend over the observed periods, increasing from 22,770 million US dollars in early 2020 to 26,702 million US dollars by early 2025. This steady growth suggests ongoing investments or acquisitions in property, plant, and equipment assets.

Land

Land values also exhibited gradual growth, rising from 8,390 million US dollars in early 2020 to 9,060 million US dollars by early 2025. The increase in land value aligns with the overall growth in net property and equipment, indicating potential expansion of physical locations or land holdings.

Depreciation and Finance Lease Amortization Expense

The depreciation and finance lease amortization expense showed a significant upward trajectory, increasing from 2,223 million US dollars in early 2020 to 3,283 million US dollars in early 2025. This rise reflects higher amortization costs, likely driven by increased capital assets and possibly shorter asset life spans or accelerated depreciation methods.

Estimated Remaining Life

The estimated remaining life of the assets remained relatively stable around 6 years, with a slight increase to 7 years in early 2021 followed by a decrease to 5 years by early 2025. This decline near the end of the period may suggest accelerated usage or planned asset replacement, which could impact future capital expenditures and depreciation patterns.