<<< HD's debt load is low>>>
HD carries most of their debt off the balance sheet. Out the other end of the cow so to speak. They also carry over $4 billion in accounts payable. I realize a lot of investors back out AP in calculating debt, I just don't know why. Not only is it debt, it's debt that has to be paid on a very short term basis. $4 billion off the balance sheet, $1 billion in notes, plus $4 billion in accounts payable, any way you look at it, they owe a lot of people a lot of money.
Here's a retailer with debt to equity of .34 to 1 (about the same as HD when off balance sheet debt is included) and almost $2 billion in cash. They also held the number one spot in their market for a lot of years, and spent a lot of money opening new stores. In their fiscal year 2000 they earned $1.19 with a PE below 10. Is it a bargain, or the other end of a cow?
biz.yahoo.com
Maybe an even more interesting question is which is likely to increase in value by 30% first. KM from .69 to .89, or HD from $34 to $45?
As far as Gates buying 1,000,000 shares of HD at $36, it looks like he's only down around $2 million at the moment. Do you suppose he bought the stock because he spends a lot of time shopping at Home Depot? |
