2022 Week 39: Home Depot (NYSE: HD)

Portfolio Update

The FiveTwenty portfolio received $89.00 in dividends in the past week. LMT and VFC paid their quarterly dividend during the week

Past Week Dividend$89.00
Current Quarter Dividend (Q3 2022)$1,623.32
LifeTime Dividend$6,230.48
Estimated Annual Dividend$6,474.73
Dividend Scorecard

The capital allocation for the week of 09/25/2022 to 10/01/2022 will be used to add to our position in Home Depot (NYSE: HD)

HD – Position Update

Since our last check-in on HD in week 35 of 2022, there have not been any significant developments for the company. The share price decreased 9.1% from $298.10 to $270.94 during the period.

TTMPrev. Update10-year median
Dividend Streak13 years13 years
Yield2.71%2.38%1.98%
Payout Ratio43.64%143.64%143%
P/E16.65118.32122.35
Entry Criteria Scorecard

1 computed using TTM EPS of $16.27 as of Q2 2022

Q2 2022 earnings report

Did HD’s latest earnings report raise any warning flags?

In Q2 2022, HD delivered the highest quarterly sales and earnings in the company’s history. Revenues, net income, and EPS grew faster year over year than in Q1. In addition, another welcome sight is that EPS grew at a higher rate than net income, and net income grew faster than revenue. Overall, revenues grew 6.5%, net income increased 7.6%, and EPS where 11.5% higher than Q2 2021.

Revenue
(in millions)
Net Income
(in millions)
EPS
.
Q2 2021$41,118$4,807$4.53
Q2 2022$43,792$5,173$5.05
% Change6.5%7.6%11.5%

Additional noteworthy developments during the quarter:

Thesis

Why are we adding to our position in HD?

With no significant developments for HD in the last week, our investment thesis remains the same. With the current investment we are merrily building our position in the company at an attractive valuation.

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