Comprehensive Stock Comparison
Compare The Home Depot, Inc. (HD) vs Arhaus, Inc. (ARHS) Stock
Analyze side-by-side fundamentals, valuation, growth, and profitability to decide which stock is the better buy.
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Quick Verdict
| Category | Winner | Why |
|---|---|---|
| Growth | ARHS | 8.5% revenue growth vs HD's 3.2% |
| Value | ARHS | Lower P/E (16.2x vs 25.2x), PEG 0.54 vs 7.07 |
| Quality / Margins | HD | 8.6% net margin vs ARHS's 4.9% |
| Stability / Safety | HD | Beta 0.60 vs ARHS's 1.39 |
| Dividends | HD | 2.4% yield, 16-year raise streak, vs ARHS's 0.0% |
| Momentum (1Y) | HD | -1.7% vs ARHS's -13.3% |
| Efficiency (ROA) | HD | 13.5% ROA vs ARHS's 4.8%, ROIC 32.1% vs 9.6% |
Who Each Stock Is For
Income & stability
Growth exposure
Long-term compounding (10Y)
Sleep-well-at-night portfolio
Valuation efficiency (growth/$)
Defensive / Recession hedge
Business Model
What each company does and how it makes money
The Home Depot is the world's largest home improvement retailer selling building materials, tools, appliances, and garden products. It generates revenue primarily from retail store sales — about 90% of total revenue — with the remainder from professional contractor services and installation offerings. Its competitive advantage lies in massive scale, extensive store network, and strong brand recognition that creates a one-stop-shop moat for DIY homeowners and professional contractors alike.
Arhaus is a premium home furnishings retailer offering high-quality furniture, lighting, textiles, and décor through an omni-channel model. It generates revenue primarily from direct-to-consumer sales through its showrooms (roughly 70% of sales) and e-commerce platform (roughly 30%), with additional income from in-home designer services. The company's moat lies in its vertically integrated supply chain—controlling design, sourcing, and manufacturing—which enables unique, high-quality products and consistent brand experience.
Revenue Breakdown by Segment
How each company's revenue is distributed across its business units
Financial Metrics Comparison
Side-by-side fundamentals across 2 stocks. BestLagging
Financial Scorecard
HD leads in 4 of 6 categories (Financial Metrics, Total Returns). ARHS leads in 1 (Valuation Metrics). 1 tied.
Financial Metrics (TTM)
HD is the larger business by revenue, generating $164.7B annually — 119.4x ARHS's $1.4B. Profitability is closely matched — net margins range from 8.6% (HD) to 4.9% (ARHS). On growth, ARHS holds the edge at +5.1% YoY revenue growth, suggesting stronger near-term business momentum.
| Metric | HDThe Home Depot, I… | ARHSArhaus, Inc. |
|---|---|---|
| RevenueTrailing 12 months | $164.7B | $1.4B |
| EBITDAEarnings before interest/tax | $24.2B | $155M |
| Net IncomeAfter-tax profit | $14.2B | $67M |
| Free Cash FlowCash after capex | $12.6B | $59M |
| Gross MarginGross profit ÷ Revenue | +33.3% | +38.9% |
| Operating MarginEBIT ÷ Revenue | +12.7% | +6.4% |
| Net MarginNet income ÷ Revenue | +8.6% | +4.9% |
| FCF MarginFCF ÷ Revenue | +7.7% | +4.3% |
| Rev. Growth (YoY)Latest quarter vs prior year | -3.8% | +5.1% |
| EPS Growth (YoY)Latest quarter vs prior year | -14.6% | -26.7% |
Valuation Metrics
At 17.2x trailing earnings, ARHS trades at a 36% valuation discount to HD's 26.8x P/E. Adjusting for growth (PEG ratio), ARHS offers better value at 0.58x vs HD's 7.49x — a lower PEG means you pay less per unit of expected earnings growth.
| Metric | HDThe Home Depot, I… | ARHSArhaus, Inc. |
|---|---|---|
| Market CapShares × price | $378.4B | $719M |
| Enterprise ValueMkt cap + debt − cash | $396.1B | $1.0B |
| Trailing P/EPrice ÷ TTM EPS | 26.75x | 17.19x |
| Forward P/EPrice ÷ next-FY EPS est. | 25.24x | 16.21x |
| PEG RatioP/E ÷ EPS growth rate | 7.49x | 0.58x |
| EV / EBITDAEnterprise value multiple | 16.39x | 11.77x |
| Price / SalesMarket cap ÷ Revenue | 2.30x | 0.52x |
| Price / BookPrice ÷ Book value/share | 29.62x | 2.79x |
| Price / FCFMarket cap ÷ FCF | 29.93x | 12.19x |
Profitability & Efficiency
HD delivers a 110.5% return on equity — every $100 of shareholder capital generates $110 in annual profit, vs $16 for ARHS. ARHS carries lower financial leverage with a 1.39x debt-to-equity ratio, signaling a more conservative balance sheet compared to HD's 1.48x.
| Metric | HDThe Home Depot, I… | ARHSArhaus, Inc. |
|---|---|---|
| ROE (TTM)Return on equity | +110.5% | +16.1% |
| ROA (TTM)Return on assets | +13.5% | +4.8% |
| ROICReturn on invested capital | +32.1% | +9.6% |
| ROCEReturn on capital employed | +29.8% | +10.2% |
| Piotroski ScoreFundamental quality 0–9 | 4 | 4 |
| Debt / EquityFinancial leverage | 1.48x | 1.39x |
| Net DebtTotal debt minus cash | $17.6B | $327M |
| Cash & Equiv.Liquid assets | $1.4B | $253M |
| Total DebtShort + long-term debt | $19.0B | $581M |
| Interest CoverageEBIT ÷ Interest expense | 8.71x | 35.91x |
Total Returns (with DRIP)
A $10,000 investment in HD five years ago would be worth $16,110 today (with dividends reinvested), compared to $6,836 for ARHS. Over the past 12 months, HD leads with a -1.7% total return vs ARHS's -13.3%. The 3-year compound annual growth rate (CAGR) favors HD at 11.2% vs ARHS's -15.5% — a key indicator of consistent wealth creation.
| Metric | HDThe Home Depot, I… | ARHSArhaus, Inc. |
|---|---|---|
| YTD ReturnYear-to-date | +10.1% | -27.4% |
| 1-Year ReturnPast 12 months | -1.7% | -13.3% |
| 3-Year ReturnCumulative with dividends | +37.3% | -39.7% |
| 5-Year ReturnCumulative with dividends | +61.1% | -31.6% |
| 10-Year ReturnCumulative with dividends | +257.2% | -31.6% |
| CAGR (3Y)Annualised 3-year return | +11.2% | -15.5% |
Risk & Volatility
HD is the less volatile stock with a 0.60 beta — it tends to amplify market swings less than ARHS's 1.39 beta. A beta below 1.0 means the stock typically moves less than the S&P 500. HD currently trades 89.2% from its 52-week high vs ARHS's 63.6% drawdown — a narrower gap to the peak suggests stronger recent price momentum.
| Metric | HDThe Home Depot, I… | ARHSArhaus, Inc. |
|---|---|---|
| Beta (5Y)Sensitivity to S&P 500 | 0.60x | 1.39x |
| 52-Week HighHighest price in past year | $426.75 | $12.98 |
| 52-Week LowLowest price in past year | $326.31 | $6.61 |
| % of 52W HighCurrent price vs 52-week peak | +89.2% | +63.6% |
| RSI (14)Momentum oscillator 0–100 | 46.1 | 44.4 |
| Avg Volume (50D)Average daily shares traded | 3.3M | 957K |
Analyst Outlook
Wall Street rates HD as "Buy" and ARHS as "Buy". Consensus price targets imply 30.3% upside for ARHS (target: $11) vs 9.0% for HD (target: $415). HD is the only dividend payer here at 2.41% yield — a key consideration for income-focused portfolios.
| Metric | HDThe Home Depot, I… | ARHSArhaus, Inc. |
|---|---|---|
| Analyst RatingConsensus buy/hold/sell | Buy | Buy |
| Price TargetConsensus 12-month target | $414.92 | $10.75 |
| # AnalystsCovering analysts | 61 | 14 |
| Dividend YieldAnnual dividend ÷ price | +2.4% | +0.0% |
| Dividend StreakConsecutive years of raises | 16 | 0 |
| Dividend / ShareAnnual DPS | $9.18 | $0.00 |
| Buyback YieldShare repurchases ÷ mkt cap | 0.0% | 0.0% |
Historical Charts
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Chart 1Total Return — 5 Years (Rebased to 100)
| Stock | Dec 21 | Feb 26 | Change |
|---|---|---|---|
| The Home Depot, Inc. (HD) | 100 | 94.43 | -5.6% |
| Arhaus, Inc. (ARHS) | 68.52 | 82.89 | +21.0% |
The Home Depot, Inc. (HD) returned +61% over 5 years vs Arhaus, Inc. (ARHS)'s -32%. A $10,000 investment in HD 5 years ago would be worth $16,110 today (including dividends reinvested).
Chart 2Revenue Growth — 10 Years
| Stock | 2016 | 2025 | Change |
|---|---|---|---|
| The Home Depot, Inc. (HD) | $94.6B | $164.7B | +74.1% |
| Arhaus, Inc. (ARHS) | $495M | $1.4B | +178.9% |
The Home Depot, Inc.'s revenue grew from $94.6B (2016) to $164.7B (2025) — a 6.4% CAGR.
Chart 3Net Margin Trend — 10 Years
| Stock | 2016 | 2025 | Change |
|---|---|---|---|
| The Home Depot, Inc. (HD) | 8.4% | 8.6% | +2.2% |
| Arhaus, Inc. (ARHS) | 1.5% | 4.9% | +220.4% |
The Home Depot, Inc.'s net margin went from 8% (2016) to 9% (2025).
Chart 4P/E Ratio History — 9 Years
| Stock | 2017 | 2025 | Change |
|---|---|---|---|
| The Home Depot, Inc. (HD) | 26 | 24.2 | -6.9% |
| Arhaus, Inc. (ARHS) | 49.1 | 23.4 | -52.3% |
The Home Depot, Inc. has traded in a 18x–27x P/E range over 9 years; current trailing P/E is ~27x. Arhaus, Inc. has traded in a 10x–49x P/E range over 5 years; current trailing P/E is ~17x.
Chart 5EPS Growth — 10 Years
| Stock | 2016 | 2025 | Change |
|---|---|---|---|
| The Home Depot, Inc. (HD) | 6.45 | 14.23 | +120.6% |
| Arhaus, Inc. (ARHS) | 0.56 | 0.48 | -14.3% |
The Home Depot, Inc.'s EPS grew from $6.45 (2016) to $14.23 (2025) — a 9% CAGR.
Chart 6Free Cash Flow — 5 Years
The Home Depot, Inc. generated $13B FCF in 2025 (-10% vs 2021). Arhaus, Inc. generated $59M FCF in 2025 (-40% vs 2021).
HD vs ARHS: Frequently Asked Questions
9 questions · data-driven answers · updated daily
01Is HD or ARHS a better buy right now?
Arhaus, Inc. (ARHS) offers the better valuation at 17.2x trailing P/E (16.2x forward), making it the more compelling value choice. Analysts rate The Home Depot, Inc. (HD) a "Buy" — based on 61 analyst ratings — the highest consensus in this comparison. The "better buy" depends entirely on your goals: growth investors should weight revenue trajectory, value investors should weight P/E and PEG, and income investors should weight dividend yield and streak.
02Which has the better valuation — HD or ARHS?
On trailing P/E, Arhaus, Inc. (ARHS) is the cheapest at 17.2x versus The Home Depot, Inc. at 26.8x. On forward P/E, Arhaus, Inc. is actually cheaper at 16.2x. The PEG ratio (P/E divided by earnings growth rate) is the most growth-adjusted single valuation metric: Arhaus, Inc. wins at 0.54x versus The Home Depot, Inc.'s 7.07x — a PEG below 1.0 traditionally signals the market is underpricing earnings growth.
03Which is the better long-term investment — HD or ARHS?
Over the past 5 years, The Home Depot, Inc. (HD) delivered a total return of +61.1%, compared to -31.6% for Arhaus, Inc. (ARHS). A $10,000 investment in HD five years ago would be worth approximately $16K today (assuming dividends reinvested). Over 10 years, the gap is even starker: HD returned +257.2% versus ARHS's -31.6%. Past returns do not guarantee future results, and the stock with the higher historical return may already have its best growth priced in.
04Which is safer — HD or ARHS?
By beta (market sensitivity over 5 years), The Home Depot, Inc. (HD) is the lower-risk stock at 0.60β versus Arhaus, Inc.'s 1.39β — meaning ARHS is approximately 130% more volatile than HD relative to the S&P 500. On balance sheet safety, Arhaus, Inc. (ARHS) carries a lower debt/equity ratio of 139% versus 148% for The Home Depot, Inc. — giving it more financial flexibility in a downturn.
05Which has better profit margins — HD or ARHS?
The Home Depot, Inc. (HD) is the more profitable company, earning 8.6% net margin versus 4.9% for Arhaus, Inc. — meaning it keeps 8.6% of every revenue dollar as bottom-line profit. Operating margin tells a similar story: HD leads at 12.7% versus 6.4% for ARHS. At the gross margin level — before operating expenses — ARHS leads at 38.9%, reflecting greater pricing power or product mix advantage. Stronger margins indicate durable pricing power, lower cost of revenue, or higher mix of software/services. They are one of the clearest signs of business quality.
06Is HD or ARHS more undervalued right now?
The PEG ratio (forward P/E divided by expected earnings growth rate) is the most precise measure of undervaluation relative to growth potential. By this metric, Arhaus, Inc. (ARHS) is the more undervalued stock at a PEG of 0.54x versus The Home Depot, Inc.'s 7.07x. A PEG below 1.0 is traditionally considered the threshold for growth-adjusted undervaluation. On forward earnings alone, Arhaus, Inc. (ARHS) trades at 16.2x forward P/E versus 25.2x for The Home Depot, Inc. — 9.0x cheaper on a one-year earnings basis. Analyst consensus price targets imply the most upside for ARHS: 30.3% to $10.75.
07Which pays a better dividend — HD or ARHS?
In this comparison, HD (2.4% yield) pays a dividend. ARHS does not pay a meaningful dividend and should not be held primarily for income.
08Is HD or ARHS better for a retirement portfolio?
For long-horizon retirement investors, The Home Depot, Inc. (HD) is the stronger choice — it scores higher on the combination of lower volatility, dividend reliability, and long-term compounding (low volatility (β 0.60), 2.4% yield, +257.2% 10Y return). Both have compounded well over 10 years (HD: +257.2%, ARHS: -31.6%), confirming both are viable long-term holds — but the lower-volatility option typically results in less emotional selling during corrections. Retirement portfolios generally favour predictability over maximum returns. Consult a financial advisor before making allocation decisions.
09What are the main differences between HD and ARHS?
Both stocks operate in the Consumer Cyclical sector, making this a peer-level intra-sector comparison — the same macro tailwinds and headwinds will affect both. In terms of investment character: HD is a large-cap quality compounder stock; ARHS is a small-cap deep-value stock. HD pays a dividend while ARHS does not, making them suitable for different income and tax situations. These fundamental differences mean investors should not choose between them on a single metric — the "better stock" depends entirely on which of these characteristics aligns with your investment strategy.
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