Home Depot Financial Ratios

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Table of Contents………………………………………………………………………………………………..1 Income Statement Horizontal Analysis……………………………………………………………….2 Discussion of Strengths and Weaknesses Of Consolidated Income Statement and Balance Sheet For The Home Depot, INC………………………………………….……...........2 . A2. Ratios for Stockholders……………………………………………………………………….......3 A2a. Strengths and Weaknesses of Ratio Calculations for Stockholders………………….………..4-5 A3. Ratios for Creditors………………………………………………………………………………5-6 A3a. Strengths and Weaknesses of Ratio/Metric Calculations for Creditors……………….………6 B. Corrective Actions or Business Opportunities……………………………………………………..8-9 C. Resources…………………………………………………………………………………………….10…show more content…
Horizontal Analysis *** (see accompanying Excel Spread Sheets) A1a. Strengths and Weaknesses of Horizontal Analysis (amounts in millions except per share values) The First Strength: The Home Depot, Inc. Net Sales show a significant increase in growth from $74,754M in 2013 compared to $78,812 in 2014. The company increased sales by $4,058 a 5.4% growth. This is a comparable growth to 6.19% for the prior fiscal year 2013. This increase in net sales is supported by a decline in cost of sales. Cost of sales declined 0.89% from 6.02% in 2013 to 5.13% in 2014, accounting for 65.25% of the net sales. This is down from 65.43% in the fiscal year 2013. A decline of 0.18% over the two periods. The Second Strength: The current year 2014 gross profit is $27,390 which constitutes 34.75% of sales. The steady gross profit percentage is also a strength and further supports the net sales growth. The gross profit itself increased from $25,842 to $27,390 for an increase of 6% over the two periods. This is consistent with the 5.4% net sales growth. Operating expenses further support the strength with a 1.87% decrease from fiscal 2013 to fiscal

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