Home Depot, Inc. (The) — Earnings Quality Grade F
HD · Consumer Cyclical
Major red flags
Screening Summary
Financial Trends
Revenue & Net Income ($B)
Margins (%)
18-Point Screening
Revenue Quality
DSO 11 days, change +1 days YoY
AR outpaced revenue for 2 consecutive years
Revenue 3.2%, CFFO -17.6%. Cash follows revenue
Expense Quality
Inventory 10.1% vs COGS 3.4%. Normal
CapEx growth 5.6% vs revenue 3.2%. Normal
SG&A/Gross Profit = 56.0%. Normal
Gross margin 33.3%, change -0.1pp. Stable
Cash Flow Quality
CFFO/NI = 1.15. Profits backed by cash
FCF $12.6B, FCF/NI = 0.89
Accruals ratio = -2.1%. Low accruals
Cash $1.4B covers only 2% of debt $65.3B
Balance Sheet Health
Goodwill+Intangibles $32.7B = 255% of equity. Over 50%
Debt/EBITDA = 2.6x. Healthy
Other assets 17.8% vs revenue 3.2%. Normal
No write-off data
Acquisition Risk
FCF after acquisitions positive
Goodwill+Intangibles change 15% YoY. Normal
Manipulation Score
M-Score = -2.40 (< -2.22). Unlikely manipulator
Beneish M-Score
Altman Z-Score
Generated from public financial data using forensic accounting frameworks. Not investment advice. Data: Yahoo Finance · 2026-04-10