Home Depot Inc. (NYSE:HD)

Debt to Equity

The debt to equity ratio shows significant volatility over the observed periods. Initially, the ratio fluctuates between approximately 11 and 38, with intermittent spikes reaching beyond 100 at certain points, indicating periods of sharply increased leverage relative to equity. Toward the latest periods, there is a pronounced downward trend, with the ratio steadily declining to below 5. This suggests a substantial reduction in debt relative to equity, signaling deleveraging efforts or growth in equity base.

Debt to Equity (Including Operating Lease Liability)

This metric closely mirrors the pattern of the standard debt to equity ratio but at slightly higher levels, reflecting the added lease obligations. It follows a similar trend of volatility with peaks reaching near 200 in some quarters before a marked decline to levels around 5 by the latest periods. The inclusion of operating lease liabilities amplifies the leverage ratios, underscoring the impact of lease commitments on financial structure.

Debt to Capital

The debt to capital ratio maintains relatively stable values throughout the periods, mostly ranging between 0.82 and 1.11. A mild downward trend is observable in the later periods, with the ratio decreasing steadily from around 0.99 to 0.82, which may indicate a gradual improvement in capital structure through reduction of debt or increase in equity components.

Debt to Capital (Including Operating Lease Liability)

This ratio shows a pattern similar to the debt to capital ratio, with a slightly higher level when operating lease liabilities are included. The trend is stable with minor fluctuations and a modest decline observed towards the later periods, suggesting a somewhat improved capital health after considering operating leases.

Debt to Assets

The debt to assets ratio exhibits moderate fluctuations around the 0.5 to 0.6 range during the entire timeline. There is no clear long-term trend, but the ratio remains consistently over 0.5, indicating that more than half of the assets are financed by debt on average, suggesting a relatively high asset leverage.

Debt to Assets (Including Operating Lease Liability)

Including operating lease liabilities, this ratio is consistently higher than the standard debt to assets ratio by approximately 0.1 throughout the periods. It fluctuates within a narrow range from about 0.6 to 0.68 and appears stable, reflecting the persistent material impact of operating leases on asset financing.

Financial Leverage

Financial leverage shows high volatility with extreme peaks in certain periods, reaching levels beyond 300, indicating phases of significant leverage. However, there is a clear downward trend towards more moderate levels, stabilizing between approximately 8 and 73 in more recent quarters. The trend suggests an overall effort to reduce leverage and possibly improve financial stability.

Interest Coverage

The interest coverage ratio trends upward early on, increasing from about 12.6 to a peak near 17, indicating improving ability to cover interest expenses from operating earnings. However, after peaking, it steadily declines to approximately 8.8 in the latest periods, reflecting a decreasing cushion for interest payments, which could be due to increased interest expenses or reduced earnings operating income.

The analyzed financial data reveals notable fluctuations in the company's capital structure over the observed period. The total debt exhibited a generally increasing trend with some periods of relative stability and slight decreases. Starting from approximately 35.8 billion US dollars, total debt rose steadily to over 56 billion US dollars by late 2024 and early 2025, indicating increasing leverage or borrowing activities during these years.

In contrast, stockholders' equity experienced significant variability, including periods of negative equity followed by recovery phases. Initially, equity was negative near -3.5 billion US dollars, gradually improving to positive territory by late 2020. Subsequently, equity saw both declines and increases, reaching a peak exceeding 12 billion US dollars by late 2025, which suggests phases of recapitalization, retained earnings accumulation, or other equity-enhancing transactions.

The debt-to-equity ratio displayed substantial volatility, reflecting the combined effect of movements in debt and equity. High ratios above 100 were observed during certain quarters, signaling extreme leverage due to low or negative equity levels. Over time, the ratio generally decreased, falling below 5 in the latest periods, which signifies a more balanced capital structure and potentially improved financial risk profile.

Total Debt

Overall rising pattern from roughly 35.8 billion to over 56 billion US dollars across the analyzed timeline, with intermittent moderation in growth.

Stockholders’ Equity

Initially negative, the equity transitioned to positive values with fluctuations, reaching a high of over 12 billion US dollars, indicating strengthening of net assets.

Debt to Equity Ratio

Displayed marked instability, peaking above 100 during periods of weak equity, followed by a progressive reduction to below 5, reflecting deleveraging and increased equity base toward the end of the period.

In summary, the data suggest a dynamic financial structure with phases of high leverage and low equity followed by efforts toward recapitalization and debt management. The company's financial risk profile appears to have improved in the most recent periods, as evidenced by a declining debt-to-equity ratio and strengthening equity position despite increasing absolute debt levels.

Total Debt (Including Operating Lease Liability)

The total debt exhibits a generally upward trend over the observed periods, increasing from approximately $41.75 billion to a peak near $65.4 billion. While there are intermittent fluctuations, a notable rise occurs around the middle to later periods, indicating increased leveraging or financing needs. This consistent elevation in debt levels suggests ongoing strategic initiatives or capital expenditures requiring external funding.

Stockholders’ Equity (Deficit)

Stockholders’ equity displays significant variability, beginning with a negative value near -$3.5 billion and improving to a positive position above $12 billion in the latest period. This progression from deficit to surplus reveals strengthening equity potentially driven by retained earnings, issuance of new equity, or reduction of liabilities. There are some periods where equity fluctuates, but the overall trajectory is toward a more robust equity base.

Debt to Equity Ratio (Including Operating Lease Liability)

The debt to equity ratio follows a highly volatile path, initially marked by extremely elevated values exceeding 100 at certain points, reflecting periods of very low or negative equity combined with substantial debt. Over time, the ratio trends downward sharply, ultimately reaching more moderate levels below 6. This decline suggests an improvement in the capital structure, with either a reduction in relative debt exposure, growth in equity, or both. The reduction in this ratio indicates enhanced financial stability and a lower risk profile from a leverage standpoint.

Overall Financial Position Insights

The combination of rising absolute debt alongside a strengthening equity base and reduced leverage ratio implies a transition to a more balanced and potentially healthier financial structure. The company appears to be managing its capital to reduce risk despite increased debt, likely through equity accretion or improved profitability. However, the elevated debt levels warrant attention, and the past extreme volatility in leverage reflects periods of financial stress or transition.

Total Debt Trends

The total debt exhibited variability over the observed periods, starting at approximately $35.8 billion and experiencing fluctuations with periods of increase and slight decline. A notable rise is evident in mid-2024, where total debt peaks near $55.7 billion before slightly descending towards the end of the dataset. This suggests an overall upward trend in total debt levels over time, with some short-term contractions.

Total Capital Trends

Total capital generally shows an increasing trend from about $32.3 billion initially to over $68.1 billion by the last period reported. Though the growth is not strictly linear, with a few minor dips, the overall capital base has expanded significantly across the observed timeframe. The upward movement in total capital is particularly pronounced from mid-2023 onward.

Debt to Capital Ratio Analysis

The debt to capital ratio demonstrates a declining trend throughout the periods. Initially exceeding 1.0, signifying total debt surpassing total capital, the ratio steadily decreases to around 0.82 by the last period. This decline, especially evident after early 2022, indicates a gradually improving capital structure with debt constituting a smaller portion of total capital over time. The reduction in leverage suggests enhanced financial stability or strategic deleveraging efforts.

Summary Insights

While total debt has increased overall, the increase in total capital has been proportionally higher, resulting in a lowering debt to capital ratio. This pattern reflects an improving balance between debt and equity components of the company's capitalization. The company appears to be managing its financial leverage with a trend toward reducing reliance on debt relative to capital. The notable jump in debt in mid-2024 should be monitored for its potential impact on financial risk, despite the simultaneous growth in total capital.

Total Debt (including operating lease liability)

The total debt shows fluctuations over the periods analyzed. Initially, it decreases slightly from approximately 41.8 billion USD in May 2020 to about 40.6 billion USD in August 2020, then gradually rises and peaks above 52 billion USD by January 2024. A significant increase is observed starting in mid-2024 with debt levels substantially increasing to over 64 billion USD by late 2025. The increasing trend towards the latter part of the timeline suggests a growing reliance on debt financing or increased obligations recorded under operating leases.

Total Capital (including operating lease liability)

Total capital shows a generally increasing trend from around 38.3 billion USD in May 2020 to roughly 53.3 billion USD by January 2024. Post this period, there is a marked and rapid increase, with capital rising steeply to about 77.5 billion USD by the end of 2025. This indicates a significant growth in the company's capital base, which may result from increased debt, equity, or both, with operating lease liabilities also contributing to this expansion.

Debt to Capital Ratio (including operating lease liability)

The debt to capital ratio exhibits a consistent downward trend from above 1.0 in early 2020 to approximately 0.84 by late 2025. This ratio declining below 1.0 indicates that total debt is less than total capital, suggesting an improved capital structure with relatively less leverage over time. The decreasing ratio occurs despite the rising absolute values of both debt and capital, hinting that capital growth outpaces the increase in debt. The reduction from around 1.09 to 0.84 reflects a strengthening of financial stability or a strategy to manage leverage more conservatively.

Total Debt

The total debt showed fluctuations throughout the observed periods, initially experiencing a moderate decline from approximately $35.8 billion to about $34.8 billion, followed by periods of increases and decreases. Notably, from early 2024 onwards, total debt rose substantially, reaching over $56 billion in the latest periods. This upward trend indicates increased leverage or borrowing activity in recent quarters.

Total Assets

Total assets demonstrated a generally increasing trend over the periods. Starting around $58.7 billion, assets progressively grew with some minor declines, reaching over $106 billion by the end of the timeframe. This suggests an overall expansion in the company's resource base, possibly through investments, acquisitions, or operational growth.

Debt to Assets Ratio

The debt to assets ratio exhibited variability but maintained a range between approximately 0.49 and 0.61 over time. The ratio initially decreased from 0.61 to around 0.49, reflecting a period of deleveraging or asset growth outpacing debt. However, in the later periods, especially from 2024 onward, the ratio rose again, fluctuating in the range of 0.52 to 0.58. This indicates a relative increase in debt compared to assets, aligned with the noted growth in total debt.

Overall Analysis

The data reveals that the company has experienced steady asset growth paired with variable debt levels. Despite fluctuations, debt to assets has remained relatively stable near the midpoint of the observed range. The recent increase in total debt coupled with continued asset growth suggests a strategic leveraging to support expansion or capitalization initiatives. Continuous monitoring of this ratio will be important to assess financial risk and capital structure optimization.

Total Debt (including operating lease liability)

The total debt exhibits a generally increasing trend over the observed periods. Starting from approximately 41.75 billion USD, debt fluctuates with moderate increases and decreases through the mid-periods, reaching a notable peak of about 64.61 billion USD in July 2024. After this peak, slight declines are observed, with debt stabilizing around 61.3 to 65.4 billion USD towards the end of the timeline. This increase indicates a growing leverage position over time, particularly in the latter years.

Total Assets

Total assets display a steady upward trajectory across the quarters. The asset base grows from roughly 58.7 billion USD initially to surpass 106.3 billion USD by November 2025. The growth is relatively continuous, with minor plateaus and slight declines occasionally noted, but overall the asset expansion suggests ongoing investments or asset accumulation by the company. The increase in assets outpaces the increase in debt, contributing to changes in the leverage ratios.

Debt to Assets Ratio (including operating lease liability)

The debt to assets ratio shows variability across the periods, beginning at a high of 0.71, followed by a decrease to a low near 0.58 in mid-2021. Subsequently, the ratio rises again, fluctuating mostly between 0.62 and 0.68, reflecting changing capital structure dynamics. The ratio remains relatively stable in the 0.61 to 0.66 range in the more recent quarters, suggesting a maintained balance between debt and asset levels despite the overall growth in both. This indicates prudent financial management to avoid excessive leverage, even as the company expands its asset and debt base.

The analysis of the quarterly financial data reveals several notable trends in the company's financial position over the examined periods.

Total Assets

Total assets have shown an overall upward trajectory, increasing from approximately US$58.7 billion in early May 2020 to about US$106.3 billion by November 2025. Despite some fluctuations, the general trend indicates growth in the asset base. Notably, there was a significant increase beginning around the first quarter of 2024, where assets surged beyond US$96 billion and continued rising steadily. This asset growth suggests expansion or increased investments over these periods.

Stockholders’ Equity

Stockholders’ equity has exhibited considerable volatility during the reviewed quarters. Initially, it was negative at approximately -US$3.5 billion in May 2020 but moved quickly into positive territory by November 2020. After some fluctuations, equity values declined again into negative in early 2022 before recovering sharply and maintaining a positive and generally increasing trend from mid-2022 onwards. The equity balance rose from a low point to approximately US$12.1 billion by November 2025, indicating improvement in the company's net worth and financial stability over time.

Financial Leverage

The financial leverage ratio has demonstrated high variability across the periods, reflecting changes in the relationship between total assets and stockholders' equity. Several extreme spikes in the leverage ratio indicate periods where equity was very low or negative, reaching values as high as above 300 at some points. However, more recent quarters show a declining leverage ratio trend, falling from very elevated levels to below 10 by late 2025. This decline suggests a reduction in reliance on debt financing or an improvement in equity relative to assets, which may indicate strengthening financial health and a more balanced capital structure.

Overall, the data reflects a company that has experienced fluctuations in equity and leverage but has managed consistent asset growth. The recent improvements in equity levels and reduction in leverage ratio highlight a positive shift towards enhanced financial resilience and potentially lower financial risk as the company progresses through the periods covered.

Earnings before interest and tax (EBIT)

The EBIT values exhibited a fluctuating pattern throughout the observed periods. Initially, there was a significant increase from 3,293 million to 6,076 million US dollars between May 2020 and August 2020. This peak was followed by a decline to 4,093 million by January 2021. Subsequently, EBIT rose again to reach higher levels above 7,000 million in July 2022, denoting a cyclical trend of growth and decline. In the most recent periods, EBIT showed a downward trend, decreasing from 6,618 million in July 2024 to 5,385 million by November 2025, indicating some contraction in operating profitability towards the end of the timeframe.

Interest expense

Interest expense demonstrated a gradual upward trend over the entire period. Starting at 324 million US dollars in May 2020, it steadily increased with minor fluctuations, peaking around 638 million in February 2025. The incremental rise in interest expense suggests increasing borrowing costs or higher debt levels over time, though the increases are moderate relative to the scale of EBIT.

Interest coverage ratio

The interest coverage ratio showed a general declining trend despite some short-term fluctuations. It peaked at 17.14 in January 2022, indicating very strong ability to cover interest expenses from operating earnings. However, after this peak, the ratio decreased steadily, reaching around 8.81 by November 2025. This reduction reflects the combination of a less consistent EBIT and rising interest expenses, implying a decreased margin of safety in meeting interest obligations over the period.

Overall insights

The data points to a company experiencing considerable volatility in operating earnings while incurring gradually increasing interest costs. The declining interest coverage ratio in recent years highlights a trend toward greater financial leverage or reduced operating profitability relative to interest expenses, which may warrant attention for financial risk management. The cyclical fluctuations in EBIT suggest sensitivity to external factors affecting operational performance, while the steady rise in interest expenses may reflect growing debt servicing demands.