MODEL VERDICT
The Home Depot, Inc. (HD)
Relative Valuation•Peer multiples, Monte Carlo simulation & quality-adjusted fair value
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Composite score derived from valuation, quality, and risk factors
Quantitative model thresholds · For educational and research purposes only
Each row records the model's monthly assessment. High Conviction = the model detected notable undervaluation vs peers. Neutral = no notable divergence was found. The return column shows the actual price change over 90 days for reference. This is a quantitative observation log — not investment advice.
| Date | Assessment | Score | Price | Status | 90d Fwd Return |
|---|---|---|---|---|---|
| May 1, 2026 | MODERATE | 0.65 | $323.88 | CURRENT | — |
| Apr 24, 2026 | MODERATE | 0.65 | $335.89 | CURRENT | — |
| Apr 17, 2026 | MODERATE | 0.65 | $349.40 | CURRENT | — |
| Apr 16, 2026 | MODERATE | 0.65 | $338.91 | CURRENT | — |
| Apr 10, 2026 | NEUTRAL | 0.45 | $337.34 | CURRENT | — |
Historical model observations for research purposes only. Past quantitative patterns do not predict future results. Not a recommendation to buy, sell, or hold any security.
| Methodology | Fair Value | vs Current | Weight | Quality | Status |
|---|---|---|---|---|---|
| Forward P/E 7 analyst estimates | $384.60 | +18.7% | 20% | A- | Analyst Est. |
| EV/EBITDA 7 industry peers | $271.43 | -16.2% | 20% | A- | Peer Data |
| Industry Median P/E 6 industry peers | $321.57 | -0.7% | 15% | A | Peer Data |
| Price / Free Cash Flow 7 industry peers | $273.92 | -15.4% | 15% | B+ | Peer Data |
| EV/EBIT 7 industry peers | $480.73 | +48.4% | 8% | B+ | Peer Data |
| EV/FCF 7 industry peers | $299.18 | -7.6% | 7% | B | Model Driven |
| Peg Ratio 5 industry peers | $114.21 | -64.7% | 5% | B | Data |
| EV To Revenue 7 industry peers | $232.65 | -28.2% | 4% | B | Data |
| Price / Sales 7 industry peers | $189.30 | -41.6% | 3% | B | Model Driven |
| Earnings Yield 6 industry peers | $316.30 | -2.3% | 2% | B | Data |
| FCF Yield 7 industry peers | $271.18 | -16.3% | 1% | B | Data |
| Weighted Output Blended model output | $442.01 | +36.5% | 100% | 82 | SIGNIFICANTLY UNDERVALUED |
| EPS Growth ↓ | P/E Multiple → | 19× | 21× | 23× (Current) | 25× | 27× |
|---|---|---|---|---|---|
| Bear Case (2%) | $276 | $305 | $334 | $363 | $392 |
| Conservative (5%) | $284 | $314 | $344 | $374 | $403 |
| Base Case (3.6%) | $280 | $310 | $339 | $369 | $398 |
| Bull Case (5%) | $283 | $313 | $343 | $373 | $403 |
Cross-sectional regression predicting expected multiples based on growth, margins, ROIC, and beta.
| Multiple | Avg | Median | Min | Max | Std |
|---|---|---|---|---|---|
| P/E Ratio | 23.20 | 22.94 | 18.93 | 26.72 | 2.73 |
| EV/EBIT | 18.17 | 17.61 | 15.45 | 20.96 | 1.96 |
| EV/EBITDA | 15.93 | 15.48 | 13.75 | 18.65 | 1.68 |
| P/FCF | 24.12 | 23.66 | 17.49 | 31.35 | 5.01 |
| P/FFO | 19.22 | 18.88 | 16.12 | 22.76 | 2.15 |
| P/AFFO | 23.29 | 22.90 | 19.09 | 26.25 | 2.50 |
| P/B Ratio | 142.32 | 86.80 | 26.77 | 332.61 | 126.43 |
| Div Yield | 0.02 | 0.02 | 0.02 | 0.03 | 0.00 |
| P/S Ratio | 2.30 | 2.17 | 2.06 | 2.90 | 0.29 |
Based on our peer multiples analysis with 28 valuation metrics, the model estimates HD's fair value at $442.01 vs the current price of $323.88, implying +36.5% upside potential. Model verdict: Significantly Undervalued. Confidence: 82/100. This is a quantitative estimate, not a recommendation.
The blended fair value of $442.01 is calculated using four lenses: industry median multiples (40%), historical multiples (30%), forward estimates (20%), and quality-adjusted multiples (10%). Monte Carlo simulation (10,000 iterations) gives a range of $301.45 (P10) to $360.86 (P90), with a median of $330.82.
HD's current P/E of 22.8x compares to the industry median of 22.6x (6 peers in the group). This represents a +0.7% premium to the industry. The historical average P/E is 23.2x over 7 years. Signal: Fair Value.
62 analysts cover HD with a consensus rating of Buy. The consensus price target is $408.08 (range: $320.00 — $454.00), implying +26.0% upside from the current price. Grade breakdown: Strong Buy (1), Buy (37), Hold (20), Sell (4), Strong Sell (0).
The model confidence score is 82/100, based on: data completeness (30), peer quality (25), historical depth (20), earnings stability (15), and model agreement (7). Cyclicality penalty: --15 points. The model shows strong agreement across inputs.
The model flags several key risks: (1) Macro/regulatory risks are not captured in this model but remain material.
Peak earnings risk refers to the possibility that HD's current profitability is above its sustainable long-term trend. The model detects a margin Z-score of -1.7σ, meaning margins are 1.7 standard deviations below their historical average. If margins revert to the 7-year mean (14.2%), the model estimates fair value drops by 6840.0% to approximately $545. This isn't a prediction — it's a scenario analysis.
No. This dashboard is a quantitative research tool for educational and informational purposes only. It is not investment advice, a solicitation, or a recommendation to buy, sell, or hold any security. The operator of this platform is not a registered investment advisor (RIA), broker-dealer, or financial planner. All model outputs, fair value estimates, signals, and scenarios are the result of automated quantitative computations and should not be construed as professional financial guidance. You should consult a qualified, licensed financial advisor before making any investment decisions. Past model performance is not indicative of future results.