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Home Depot, Inc. (The) (HD) vs AT&T Inc. (T): Which Is the Better Buy in 2026?

As of 2026-08-03, HD is undervalued at $332, with a DCF intrinsic value of $248851992757 and a margin of safety of 100%. T is undervalued at $23, with an intrinsic value of $56 and a margin of safety of 58%. Of the two, HD has the wider margin of safety.

HD
Home Depot, Inc. (The)
$331.96
VS
T
AT&T Inc.
$23.25

Rewards

HD
  • ★Home Depot, Inc. (The) has maintained ROIC above 15% for 4 consecutive years, indicating a durable competitive advantage.
  • ★Home Depot, Inc. (The) scores 87/100 on the Economic Moat Score (Wide Moat), with margin stability as the strongest competitive dimension.
  • ★Return on equity has consistently exceeded 20% over 4 years, indicating efficient use of shareholder capital.
T
  • ★Free cash flow has grown at a 16.2% CAGR over the past 4 years, demonstrating strong earnings power growth.
  • ★Each dollar of retained earnings has created $14.89 of earning power — management is an exceptional capital allocator.
  • ★FCF yield of 12.2% is historically attractive — the business generates significant cash relative to its price.

Risks

HD
  • ⚠High leverage (4.48x net debt/equity) combined with thin interest coverage (-1.0x) poses financial risk.
  • ⚠11 insider sales with no purchases over the past 12 months — a persistent pattern of insider selling.
T
  • ⚠Altman Z-Score of 0.89 places the company in the distress zone — financial patterns resemble those of companies that experienced bankruptcy.

Key Valuation Metrics

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HD
T
Valuation
$10.13B
Free Cash Flow
$19.44B
N/A
FCF Yield
12.20%
23.58
Trailing P/E
7.67
20.63
Forward P/E
9.07
Quality & Moat
20.22%
ROIC
8.47%
128.38%
ROE
18.34%
33.13%
Gross Margin
59.72%
1.87
PEG Ratio
1.55
Balance Sheet Safety
4.48
Net Debt / Equity
1.15
N/A
Interest Coverage
N/A
2.49
Net Debt / EBITDA
3.30
2.81%
Dividend Yield
4.77%
HD: 3Ties: 1T: 7
HDT

Historical Fundamentals

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HD

Price ÷ Earnings Per Share — how many years of current earnings you're paying for at today's price. Lower P/E may indicate undervaluation. The dashed forward point is the forward P/E — today's price ÷ analyst consensus EPS.

T

Price ÷ Earnings Per Share — how many years of current earnings you're paying for at today's price. Lower P/E may indicate undervaluation. The dashed forward point is the forward P/E — today's price ÷ analyst consensus EPS.

Price ÷ Earnings Per Share — how many years of current earnings you're paying for at today's price. Lower P/E may indicate undervaluation. The dashed forward point is the forward P/E — today's price ÷ analyst consensus EPS.

$1 Retained Earnings Test

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HD
$-0.00
created per $1 retained over 3 years
Market Cap Declined
Σ Retained
$17.64B
Δ Market Cap
$-14.59
Buffett's "$1 Test": For every $1 of earnings retained, has management created at least $1 of market value?
> $1 created per $1 retained = Value Creator · < $1 created = Value Destroyer
T
$1.91
created per $1 retained over 3 years
Value Creator
Σ Retained
$22.78B
Δ Market Cap
+$43.59B
Buffett's "$1 Test": For every $1 of earnings retained, has management created at least $1 of market value?
> $1 created per $1 retained = Value Creator · < $1 created = Value Destroyer

Buffett's "$1 Test": For every $1 of earnings retained, has management created at least $1 of market value?
> $1 created per $1 retained = Value Creator · < $1 created = Value Destroyer

Discounted Cash Flow (DCF) Analysis

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HD
100.0% Margin of Safety
Price is 100.0% below estimated fair value
Current Price: $331.96
Fair Value: $248851992757.04
Strongly undervalued
Undervalued
Fairly valued
Overvalued
Strongly overvalued
T
58.2% Margin of Safety
Price is 58.2% below estimated fair value
Current Price: $23.25
Fair Value: $55.59
Strongly undervalued
Undervalued
Fairly valued
Overvalued
Strongly overvalued

Reverse DCF — Market-Implied Growth

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HD

What growth rate is the market pricing in at $332?

-14.7%
Market-Implied Owner Earnings Growth
Standard FCF implies -9.0%

The market implies -14.7% Owner Earnings growth, below historical trends — potential opportunity.

Standard FCF implies a more demanding -9.0%, reflecting heavy growth investment expected to generate future returns.

T

What growth rate is the market pricing in at $23?

+2.8%
Market-Implied Owner Earnings Growth
Standard FCF implies +4.5%

The market implies +2.8% Owner Earnings growth, below historical trends — potential opportunity.

Standard FCF implies a more demanding +4.5%, reflecting heavy growth investment expected to generate future returns.

Economic Moat Score

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HD
87/100
Wide Moat
70+ Wide · 40-69 Narrow · <40 None

Wide moat with strength across all dimensions. Margin Stability is the standout factor.

Composite score measuring competitive advantage durability across four dimensions: returns above cost of capital, pricing power stability, revenue predictability, and capital efficiency. Based on 4 years of fundamental data.
T
57/100
Narrow Moat
70+ Wide · 40-69 Narrow · <40 None

Narrow moat with margin stability as the key competitive advantage. Improving roic consistency would strengthen the moat.

Composite score measuring competitive advantage durability across four dimensions: returns above cost of capital, pricing power stability, revenue predictability, and capital efficiency. Based on 4 years of fundamental data.

Forensic Accounting

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HD
-2.40
Unlikely Manipulator
Above -1.78 = likely manipulator · -2.22 to -1.78 = grey zone

M-Score Trend

Beneish's 8-variable model estimates the probability of earnings manipulation. An M-Score above -1.78 signals elevated risk — companies in this range have historically been 3-5× more likely to be manipulating earnings. Scores between -2.22 and -1.78 fall in a grey zone warranting further investigation.
T
-2.78
Unlikely Manipulator
Above -1.78 = likely manipulator · -2.22 to -1.78 = grey zone

M-Score Trend

Beneish's 8-variable model estimates the probability of earnings manipulation. An M-Score above -1.78 signals elevated risk — companies in this range have historically been 3-5× more likely to be manipulating earnings. Scores between -2.22 and -1.78 fall in a grey zone warranting further investigation.

Beneish's 8-variable model estimates the probability of earnings manipulation. An M-Score above -1.78 signals elevated risk — companies in this range have historically been 3-5× more likely to be manipulating earnings. Scores between -2.22 and -1.78 fall in a grey zone warranting further investigation.

Ownership Breakdown

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HD
Insiders 0.1%Institutions 75.9%Retail & Other 24.1%
No. of Institutional Holders5,059
High insider ownership aligns management incentives with shareholders — a key signal in Buffett-style analysis. Institutional concentration can indicate smart-money conviction but also crowding risk.
T
Insiders 0.1%Institutions 70.2%Retail & Other 29.7%
No. of Institutional Holders3,514
High insider ownership aligns management incentives with shareholders — a key signal in Buffett-style analysis. Institutional concentration can indicate smart-money conviction but also crowding risk.

High insider ownership aligns management incentives with shareholders. Institutional concentration can indicate smart-money conviction but also crowding risk.

Insider Buying Activity

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HD
0
Buys (3M)
0
Buys (12M)
BRENNEMAN GREGORY D
Director
$999,767
@ $346.66 · 2025-03-14
Open market purchases · includes direct & indirect ownership · excludes option exercises
T
0
Buys (3M)
0
Buys (12M)
No open market insider purchases found.
Open market purchases · includes direct & indirect ownership · excludes option exercises

Open market purchases · includes direct & indirect ownership · excludes option exercises.

Insider Selling Activity

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HD
0
Sells (3M)
11
Sells (12M)
Total value (12M): $23.56M
MCPHAIL RICHARD V
Chief Financial Officer
$940,670
@ $368.89 · 2026-03-04
DEATON JOHN A.
Officer
$661,617
@ $369.00 · 2026-03-04
ROSEBOROUGH TERESA WYNN
General Counsel
$1.00M
@ $348.52 · 2025-12-26
BROWN ANGIE
Chief Technology Officer
$695,948
@ $357.63 · 2025-12-12
BASTEK WILLIAM D
Officer
$974,445
@ $423.12 · 2025-09-12
BASTEK WILLIAM D
Officer
$1.55M
@ $410.23 · 2025-08-22
ROSEBOROUGH TERESA WYNN
General Counsel
$2.27M
@ $413.23 · 2025-08-22
DECKER EDWARD P.
Chief Executive Officer
$13.07M
@ $397.22 · 2025-08-21
BROWN ANGIE
Chief Technology Officer
$404,070
@ $404.07 · 2025-08-20
MCPHAIL RICHARD V
Chief Financial Officer
$1.36M
@ $403.66 · 2025-08-20
PADILLA HECTOR A
Officer
$640,609
@ $404.17 · 2025-08-20
DEATON JOHN A.
Officer
$3.29M
@ $369.99 · 2025-06-03
ROSEBOROUGH TERESA WYNN
General Counsel
$2.00M
@ $369.28 · 2025-05-28
SIDDIQUI FAHIM
Chief Technology Officer
$954,564
@ $367.14 · 2025-05-22
BASTEK WILLIAM D
Officer
$1.24M
@ $416.61 · 2024-11-22
HOURIGAN TIMOTHY A
Officer
$6.55M
@ $409.52 · 2024-11-18
PADILLA HECTOR A
Officer
$1.48M
@ $408.96 · 2024-11-14
CAMPBELL ANN-MARIE
Officer
$12.24M
@ $408.40 · 2024-11-14
ROSEBOROUGH TERESA WYNN
General Counsel
$9.03M
@ $408.91 · 2024-11-14
MCPHAIL RICHARD V
Chief Financial Officer
$2.65M
@ $408.45 · 2024-11-13
SCARDINO KIMBERLY R.
Officer
$617,100
@ $363.00 · 2024-08-19
ROSEBOROUGH TERESA WYNN
General Counsel
$1.87M
@ $359.32 · 2024-08-15
Direct ownership only · excludes indirect, option exercises, planned (10b5-1) sales & derivatives
T
0
Sells (3M)
0
Sells (12M)
SABRINA SANDERS S
Officer
$41,348
@ $27.57 · 2025-05-28
Direct ownership only · excludes indirect, option exercises, planned (10b5-1) sales & derivatives

Direct ownership only · excludes indirect, option exercises, planned (10b5-1) sales & derivatives.

🎭 Mr. Market's Mood

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HD
FearGreed
😐Neutral(46/100)

"Market is pricing this stock without strong emotion in either direction"

Composite sentiment score based on 6 market signals. Inspired by Buffett's "Mr. Market" allegory — fear = potential opportunity, greed = potential risk. Must be used alongside fundamental analysis, not in isolation.
T
FearGreed
😐Neutral(50/100)

"Market is pricing this stock without strong emotion in either direction"

Composite sentiment score based on 6 market signals. Inspired by Buffett's "Mr. Market" allegory — fear = potential opportunity, greed = potential risk. Must be used alongside fundamental analysis, not in isolation.

Composite sentiment score based on market signals. Inspired by Buffett’s "Mr. Market" allegory — fear = potential opportunity, greed = potential risk. Must be used alongside fundamental analysis, not in isolation.

⚖️ Buffett Signal

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HD
⚪Awaiting DCF Data

The Buffett Signal cross-references market sentiment with DCF valuation. Configure the DCF Analysis above to generate a signal.

DCF Margin of Safety: N/AMr. Market's Mood: Neutral (46)
T
⚪Awaiting DCF Data

The Buffett Signal cross-references market sentiment with DCF valuation. Configure the DCF Analysis above to generate a signal.

DCF Margin of Safety: N/AMr. Market's Mood: Neutral (50)
View HD Full AnalysisView T Full Analysis

Frequently Asked Questions: HD vs T

Is Home Depot, Inc. (The) or AT&T Inc. more undervalued in 2026?▼

Based on our discounted cash flow model, HD trades at a 100.0% margin of safety (intrinsic value $248851992757 vs. price $332), compared to T's 58.2% margin of safety (intrinsic $56 vs. $23).

Which stock has a wider economic moat, Home Depot, Inc. (The) or AT&T Inc.?▼

HD scores 87/100 (Wide moat), while T scores 57/100 (Narrow moat). The moat score measures competitive advantage durability across ROIC consistency, margin stability, revenue predictability, and reinvestment efficiency.

Is AT&T Inc. in financial distress?▼

T's Altman Z-Score of 0.9 places it in the Distress zone, signaling elevated bankruptcy risk. HD scores 3.5 (Safe zone). The Altman Z-Score is a five-factor model that predicts insolvency within two years; scores below 1.81 indicate significant distress.

Which stock has higher return on invested capital, Home Depot, Inc. (The) or AT&T Inc.?▼

HD earns 20.2% ROIC versus T's 8.5%. A higher ROIC means the company generates more profit per dollar of capital employed, a hallmark of durable competitive advantage in Buffett-style analysis.

Which dividend is safer, Home Depot, Inc. (The)'s or AT&T Inc.'s?▼

T's dividend earns a safety score of 91/100 (Very Safe), compared to HD's 69/100 (Safe). T has raised its dividend for 2 consecutive years.