⚠ A 1.3% RaiseLow threat

Home Depot (HD) — threat to the moat

Home Depot raised its dividend just 1.3% in 2026, the board holding a promise while earnings fall.

The quarterly dividend rose from $2.30 to $2.33 in February 20261. The annual dividend had gone from $8.36 in fiscal 2023 to $9.00 and $9.202: raises of about 8% and 2%, then 1.3%.

Operating cash flow vs dividends paid, fiscal 2025 ($M)16,325Operating cash flow3,679Capital expenditure9,152Dividends paidHome Depot Form 10-K fiscal 2025, cash flow statement
Covered, with less to spare.

The board is caught between its policy and its earnings. Diluted EPS was $15.11 in fiscal 2023 and $14.23 in fiscal 20253; holding a 55% target would have meant a cut.

For an income investor the dividend is safe. Operating cash flow covered dividends paid 1.8 times in fiscal 2025 ($16,325 million against $9,152 million)4.

The dividend paid in fiscal 2025 was $9,152 million against $8,383 million two years earlier5, while net earnings fell from $15,143 million to $14,156 million6. The payout is taking a growing share of a shrinking profit.

The sign to watch is the size of the next raise. Another increase near 1% would confirm the dividend is now tied to earnings recovery; a return to mid-single digits would mean the board expects the recovery to come.

References
  1. ReportedThe quarterly dividend rose from $2.30 to $2.33 in February 2026.
    The Home Depot fourth-quarter and fiscal 2025 results release, Form 8-K exhibit 99.1 - fiscal 2026 guidance, the dividend raised to $2.33 a quarter, adjusted EPS of $14.69. — Fiscal 2025 · publ. 24 February 2026 · source ↗
  2. ReportedThe annual dividend had gone from $8.36 in fiscal 2023 to $9.00 and $9.20: raises of about 8% and 2%, then 1.3%.
    The Home Depot Form 10-K for fiscal 2025 (the 52 weeks ended 1 February 2026) - Item 1 business and Item 2 properties: stores, Pros, SRS, competition and supply chain. — Fiscal 2025 · publ. 18 March 2026 · source ↗
  3. ReportedDiluted EPS was $15.11 in fiscal 2023 and $14.23 in fiscal 2025; holding a 55% target would have meant a cut.
    The Home Depot Form 10-K for fiscal 2025 (the 52 weeks ended 1 February 2026) - Item 1 business and Item 2 properties: stores, Pros, SRS, competition and supply chain. — Fiscal 2025 · publ. 18 March 2026 · source ↗
  4. ReportedOperating cash flow covered dividends paid 1.8 times in fiscal 2025 ($16,325 million against $9,152 million).
    The Home Depot Form 10-K for fiscal 2025 (the 52 weeks ended 1 February 2026) - financial statements and notes: earnings, cash flow, balance sheet, debt and acquisitions. — Fiscal 2025 · publ. 18 March 2026 · source ↗
  5. ReportedThe dividend paid in fiscal 2025 was $9,152 million against $8,383 million two years earlier, while net earnings fell from $15,143 million to $14,156 million.
    The Home Depot Form 10-K for fiscal 2025 (the 52 weeks ended 1 February 2026) - financial statements and notes: earnings, cash flow, balance sheet, debt and acquisitions. — Fiscal 2025 · publ. 18 March 2026 · source ↗
  6. ReportedThe dividend paid in fiscal 2025 was $9,152 million against $8,383 million two years earlier, while net earnings fell from $15,143 million to $14,156 million.
    The Home Depot Form 10-K for fiscal 2025 (the 52 weeks ended 1 February 2026) - financial statements and notes: earnings, cash flow, balance sheet, debt and acquisitions. — Fiscal 2025 · publ. 18 March 2026 · source ↗
Sources
Generated September 26, 2026