HD vs. MSFT: A Head-to-Head Stock Comparison
Updated onHere’s a clear look at HD and MSFT, comparing key factors like historical performance, profitability, financial strength, growth, dividend, and valuation.
Company Profile
| Symbol | HD | MSFT |
|---|---|---|
| Company Name | The Home Depot, Inc. | Microsoft Corporation |
| Country | United States | United States |
| GICS Sector | Consumer Discretionary | Information Technology |
| GICS Industry | Specialty Retail | Software |
| Market Capitalization | 408.20 billion USD | 3,863.09 billion USD |
| Exchange | NYSE | NasdaqGS |
| Listing Date | September 22, 1981 | March 13, 1986 |
| Security Type | Common Stock | Common Stock |
Historical Performance
This chart compares the performance of HD and MSFT by tracking the growth of an initial $10,000 investment in each. Use the tabs to select the desired time period. Data is adjusted for dividends and splits.
Historical Performance at a Glance
| Symbol | HD | MSFT |
|---|---|---|
| 5-Day Price Return | -2.56% | 2.50% |
| 13-Week Price Return | 6.39% | 5.62% |
| 26-Week Price Return | 9.45% | 33.06% |
| 52-Week Price Return | -2.02% | 20.78% |
| Month-to-Date Return | -2.02% | 0.34% |
| Year-to-Date Return | 2.06% | 23.30% |
| 10-Day Avg. Volume | 3.37M | 21.67M |
| 3-Month Avg. Volume | 3.58M | 20.04M |
| 3-Month Volatility | 19.94% | 16.30% |
| Beta | 1.06 | 1.07 |
Profitability
Return on Equity (TTM)
HD
188.48%
Specialty Retail Industry
- Max
- 64.63%
- Q3
- 37.13%
- Median
- 19.07%
- Q1
- 10.79%
- Min
- -16.66%
HD’s Return on Equity of 188.48% is exceptionally high, placing it well beyond the typical range for the Specialty Retail industry. This demonstrates a superior ability to generate profit from shareholder investments, though it could also be inflated by high financial leverage.
MSFT
32.44%
Software Industry
- Max
- 66.28%
- Q3
- 21.28%
- Median
- 9.33%
- Q1
- -8.77%
- Min
- -48.16%
In the upper quartile for the Software industry, MSFT’s Return on Equity of 32.44% signals a highly effective use of shareholder capital to drive profitability compared to most of its peers.
Net Profit Margin (TTM)
HD
8.86%
Specialty Retail Industry
- Max
- 21.04%
- Q3
- 10.99%
- Median
- 6.08%
- Q1
- 2.46%
- Min
- -4.37%
HD’s Net Profit Margin of 8.86% is aligned with the median group of its peers in the Specialty Retail industry. This indicates its ability to convert revenue into profit is typical for the sector.
MSFT
36.15%
Software Industry
- Max
- 51.92%
- Q3
- 19.23%
- Median
- 6.98%
- Q1
- -7.14%
- Min
- -41.00%
A Net Profit Margin of 36.15% places MSFT in the upper quartile for the Software industry, signifying strong profitability and more effective cost management than most of its peers.
Operating Profit Margin (TTM)
HD
13.09%
Specialty Retail Industry
- Max
- 33.35%
- Q3
- 16.40%
- Median
- 9.28%
- Q1
- 4.05%
- Min
- -10.63%
HD’s Operating Profit Margin of 13.09% is around the midpoint for the Specialty Retail industry, indicating that its efficiency in managing core business operations is typical for the sector.
MSFT
45.29%
Software Industry
- Max
- 60.40%
- Q3
- 21.25%
- Median
- 9.90%
- Q1
- -4.97%
- Min
- -43.50%
An Operating Profit Margin of 45.29% places MSFT in the upper quartile for the Software industry. This signals a strong ability to translate revenue into operating profit, outperforming most of its competitors in core business efficiency.
Profitability at a Glance
| Symbol | HD | MSFT |
|---|---|---|
| Return on Equity (TTM) | 188.48% | 32.44% |
| Return on Assets (TTM) | 14.91% | 18.20% |
| Net Profit Margin (TTM) | 8.86% | 36.15% |
| Operating Profit Margin (TTM) | 13.09% | 45.29% |
| Gross Profit Margin (TTM) | 33.35% | 68.82% |
Financial Strength
Current Ratio (MRQ)
HD
1.15
Specialty Retail Industry
- Max
- 2.72
- Q3
- 1.81
- Median
- 1.38
- Q1
- 1.15
- Min
- 0.52
HD’s Current Ratio of 1.15 falls into the lower quartile for the Specialty Retail industry. This indicates a tighter liquidity situation and a more constrained capacity to handle short-term debt than many of its competitors.
MSFT
1.35
Software Industry
- Max
- 4.29
- Q3
- 2.37
- Median
- 1.40
- Q1
- 1.03
- Min
- 0.25
MSFT’s Current Ratio of 1.35 aligns with the median group of the Software industry, indicating that its short-term liquidity is in line with its sector peers.
Debt-to-Equity Ratio (MRQ)
HD
4.91
Specialty Retail Industry
- Max
- 3.44
- Q3
- 1.57
- Median
- 0.60
- Q1
- 0.22
- Min
- 0.00
With a Debt-to-Equity Ratio of 4.91, HD operates with exceptionally high leverage compared to the Specialty Retail industry norm. This suggests an aggressive reliance on debt financing, which can magnify returns but also significantly elevates financial risk.
MSFT
0.26
Software Industry
- Max
- 2.16
- Q3
- 0.86
- Median
- 0.31
- Q1
- 0.00
- Min
- 0.00
MSFT’s Debt-to-Equity Ratio of 0.26 is typical for the Software industry, indicating its use of leverage is in line with the sector norm. This suggests a balanced approach to its capital structure.
Interest Coverage Ratio (TTM)
HD
10.15
Specialty Retail Industry
- Max
- 48.12
- Q3
- 39.12
- Median
- 14.13
- Q1
- 3.63
- Min
- -36.00
HD’s Interest Coverage Ratio of 10.15 is positioned comfortably within the norm for the Specialty Retail industry, indicating a standard and healthy capacity to cover its interest payments.
MSFT
891.80
Software Industry
- Max
- 89.65
- Q3
- 32.64
- Median
- 1.00
- Q1
- -9.84
- Min
- -71.23
With an Interest Coverage Ratio of 891.80, MSFT demonstrates a superior capacity to service its debt, placing it well above the typical range for the Software industry. This stems from either robust earnings or a conservative debt load.
Financial Strength at a Glance
| Symbol | HD | MSFT |
|---|---|---|
| Current Ratio (MRQ) | 1.15 | 1.35 |
| Quick Ratio (MRQ) | 0.34 | 1.35 |
| Debt-to-Equity Ratio (MRQ) | 4.91 | 0.26 |
| Interest Coverage Ratio (TTM) | 10.15 | 891.80 |
Growth
Revenue Growth
EPS Growth
Dividend
Dividend Yield (TTM)
HD
2.28%
Specialty Retail Industry
- Max
- 6.48%
- Q3
- 2.84%
- Median
- 1.04%
- Q1
- 0.00%
- Min
- 0.00%
HD’s Dividend Yield of 2.28% is consistent with its peers in the Specialty Retail industry, providing a dividend return that is standard for its sector.
MSFT
0.63%
Software Industry
- Max
- 0.22%
- Q3
- 0.11%
- Median
- 0.00%
- Q1
- 0.00%
- Min
- 0.00%
MSFT’s Dividend Yield of 0.63% is exceptionally high, placing it well above the typical range for the Software industry. While this may seem attractive, an unusually high yield can sometimes be a warning sign, reflecting a falling stock price or market concerns about the dividend’s sustainability.
Dividend Payout Ratio (TTM)
HD
61.82%
Specialty Retail Industry
- Max
- 192.64%
- Q3
- 79.43%
- Median
- 26.55%
- Q1
- 0.00%
- Min
- 0.00%
HD’s Dividend Payout Ratio of 61.82% is within the typical range for the Specialty Retail industry, suggesting a balanced approach between shareholder payouts and company reinvestment.
MSFT
23.65%
Software Industry
- Max
- 3.29%
- Q3
- 2.41%
- Median
- 0.00%
- Q1
- 0.00%
- Min
- 0.00%
At 23.65%, MSFT’s Dividend Payout Ratio is exceptionally high, exceeding the typical range for the Software industry. While this provides a significant return to shareholders, it may limit funds for reinvestment and could be difficult to sustain.
Dividend at a Glance
| Symbol | HD | MSFT |
|---|---|---|
| Dividend Yield (TTM) | 2.28% | 0.63% |
| Dividend Payout Ratio (TTM) | 61.82% | 23.65% |
Valuation
Price-to-Earnings Ratio (TTM)
HD
27.13
Specialty Retail Industry
- Max
- 47.04
- Q3
- 27.74
- Median
- 23.51
- Q1
- 13.77
- Min
- 7.47
HD’s P/E Ratio of 27.13 is within the middle range for the Specialty Retail industry. This suggests its valuation is in line with the sector average, representing neither a significant premium nor a discount compared to its peers.
MSFT
37.47
Software Industry
- Max
- 145.74
- Q3
- 94.88
- Median
- 45.35
- Q1
- 26.66
- Min
- 8.80
MSFT’s P/E Ratio of 37.47 is within the middle range for the Software industry. This suggests its valuation is in line with the sector average, representing neither a significant premium nor a discount compared to its peers.
Price-to-Sales Ratio (TTM)
HD
2.40
Specialty Retail Industry
- Max
- 5.77
- Q3
- 2.79
- Median
- 1.21
- Q1
- 0.53
- Min
- 0.09
HD’s P/S Ratio of 2.40 aligns with the market consensus for the Specialty Retail industry. This suggests its valuation, based on sales, is seen as standard and is on par with its competitors.
MSFT
13.54
Software Industry
- Max
- 25.67
- Q3
- 13.68
- Median
- 8.28
- Q1
- 4.95
- Min
- 0.90
MSFT’s P/S Ratio of 13.54 aligns with the market consensus for the Software industry. This suggests its valuation, based on sales, is seen as standard and is on par with its competitors.
Price-to-Book Ratio (MRQ)
HD
35.53
Specialty Retail Industry
- Max
- 16.93
- Q3
- 7.92
- Median
- 3.98
- Q1
- 1.86
- Min
- 0.55
At 35.53, HD’s P/B Ratio is at an extreme premium to the Specialty Retail industry. This signifies that the market’s valuation is heavily reliant on future potential rather than its current net asset value, which can be a high-risk proposition.
MSFT
10.76
Software Industry
- Max
- 30.67
- Q3
- 14.92
- Median
- 8.52
- Q1
- 3.89
- Min
- 0.38
MSFT’s P/B Ratio of 10.76 is within the conventional range for the Software industry. This shows a balanced market view, where the stock’s price is neither at a significant premium nor a discount to the book value of its peers.
Valuation at a Glance
| Symbol | HD | MSFT |
|---|---|---|
| Price-to-Earnings Ratio (TTM) | 27.13 | 37.47 |
| Price-to-Sales Ratio (TTM) | 2.40 | 13.54 |
| Price-to-Book Ratio (MRQ) | 35.53 | 10.76 |
| Price-to-Free Cash Flow Ratio (TTM) | 27.89 | 53.28 |