Home Depot

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FINANCIAL ANALYSIS
END TERM PROJECT

The Home Depot Inc.
Submitted by:
Janmey Patel (202) Nikhil Arora (206) Shashank Mohore (228) Aniket Gupta (229) Parandeep Singh Chawla (231)

TABLE OF CONTENTS
Home Improvement Industry in United States3
US Home improvement Industry3
Market Scenario from 2000 to 20093
Market Scenario from 2010 and beyond4
Key Market Segments (Global level)4
US Market5
Market Outlook6
Major players in the industry and their market positioning6
Financial & Operating Performance6
Financial Ratios of the company6
Analysis7
Financial Performance8
SWOT Analysis9
Strengths9
Weakness10
Opportunities11
Threats12
Strategy of the Company14
Questions14
Evaluate Home Depot’s Business Strategy. Do you think it is viable strategy in the long run?14
Analyze Home Depots financial performance during the fiscal years 1983-1985.Compare Home Depots performance in this period with Hechingers performance.15
Comparison of Financial Performance: Home Depot Inc. vs. Hechinger17
How productive were Home Depot’s stores in the fiscal years 1983 – 1985?18
Home Depot’s stock price was dropped by 23% between January 1985 and February 1986, making it difficult for the company to rely on equity capital to finance its growth. Covenants on existing debt restrict the magnitude of the company’s future borrowing. Given these constraints, what specific actions should Home Depot take with respect to its current operations and growth strategy? How can the company improve its operating performance? Should the company change its strategy? If so how?20

Home Improvement Industry in United States
Home improvement or home renovations the process of renovating or making additions to one's home. Home Improvement stores are the centers from where building materials and hardware for the same can be purchased. US Home improvement Industry

* Home or residential renovation is a Billions industry in the United States. The average cost per project is $3,000 in the United States. * There are several types of companies that contribute to the booming renovation industry. Supply businesses such as Home Depot, Lowes, Menards and Rona Lansing provide all the materials and tools necessary to facilitate home renovations. Many online companies and home improvement websites offer tips, guidelines and trends to give homeowners ideas for design and decor. Market Scenario from 2000 to 2009

* Figures tell regarding the decline of interest and expenditure in the US home improvement industries. These figures come in the wake of the huge 2000 – 2007 housing boom which has been blamed by many financial experts as the cause of the recession; it was mortgage markets which dealt the first big hit to the world economy due to a high number of failing sub-prime mortgage loans. * However, the dip in home improvement spending is damaging the US economy further because tradesmen, such as builders, decorators, interior designers and architects are struggling to find work. According to studies by Harvard University, Spring is typically a busy time for the home improvement industries...
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