Home Depot Case Assignment

1) Analyze Home Depots financial performance during the fiscal years 1983-1985 by
completing the 4 part Dupont model. You should use the income statement, the
balance sheet, and the 5 year summary of performance.

2) How productive were Home Depots stores in the fiscal years 1983-1985. You may
use the statistics in Exhibit 1 and Managements Discussion and Analysis in this
analysis. We are looking for metrics such as sales per square foot. Be creative in
attempting to show performance through non-accounting measures-try several ratios.

3) How can the company improve its store productivity?

4) Complete an analysis of the cash flow statement presented. We recommend you use
either the scan or source/use methods. The negative cash flow from operations for the
three years eliminates the ratio method.

5) Evaluate Home Depots growth strategy. Do you agree with their expansion plans in
the mid- 1980s? Would you have argued for modest growth and an effort to put the
financial house in order?

Short note: the period ending February 2, 1986 is fiscal 1985.