The Gap, Inc. (GAP)vsThe Home Depot Inc (HD)
GAP
The Gap, Inc.
$20.54
-1.58%
CONSUMER CYCLICAL · Cap: $7.86B
HD
The Home Depot Inc
$299.98
-0.84%
CONSUMER CYCLICAL · Cap: $304.98B
Smart Verdict
WallStSmart Research — data-driven comparison
The Home Depot Inc generates 1004% more annual revenue ($169.18B vs $15.33B). HD leads profitability with a 8.4% profit margin vs 8.1%. GAP appears more attractively valued with a PEG of 1.16. GAP earns a higher WallStSmart Score of 68/100 (B-).
GAP
Strong Buy68
out of 100
Grade: B-
HD
Buy58
out of 100
Grade: C
Intrinsic Value Comparison
Multi-model valuation · Graham Formula
Margin of Safety
-24.1%
Fair Value
$22.12
Current Price
$20.54
$1.58 premium
Margin of Safety
-38.8%
Fair Value
$217.98
Current Price
$299.98
$82.00 premium
Key Strengths & Concerns
Side-by-side fundamental analysis
Key Strengths
Attractively priced relative to earnings
Earnings expanding 142.1% YoY
Every $100 of equity generates 21 in profit
Reasonable price relative to book value
Mega-cap, among the largest globally
Every $100 of equity generates 86 in profit
Safe zone — low bankruptcy risk
Generating 4.5B in free cash flow
Areas to Watch
Elevated debt levels
Weak financial health signals
Revenue declined 2.0%
Expensive relative to growth rate
Trading at 18.0x book value
4.6% earnings growth
Weak financial health signals
Comparative Analysis Report
WallStSmart ResearchBull Case : GAP
The strongest argument for GAP centers on P/E Ratio, EPS Growth, Return on Equity. PEG of 1.16 suggests the stock is reasonably priced for its growth.
Bull Case : HD
The strongest argument for HD centers on Market Cap, Return on Equity, Altman Z-Score.
Bear Case : GAP
The primary concerns for GAP are Debt/Equity, Piotroski F-Score, Revenue Growth.
Bear Case : HD
The primary concerns for HD are PEG Ratio, Price/Book, EPS Growth. Debt-to-equity of 3.77 is elevated, increasing financial risk.
Key Dynamics to Monitor
GAP carries more volatility with a beta of 2.06 — expect wider price swings.
HD is growing revenue faster at 5.7% — sustainability is the question.
HD generates stronger free cash flow (4.5B), providing more financial flexibility.
Monitor APPAREL RETAIL industry trends, competitive dynamics, and regulatory changes.
Bottom Line
GAP scores higher overall (68/100 vs 58/100). Both earn "Strong Buy" and "Buy" ratings respectively — the choice depends on your investment horizon and risk tolerance.
This analysis is generated from publicly available financial data. Not financial advice.
The Gap, Inc.
CONSUMER CYCLICAL · APPAREL RETAIL · USA
The Gap, Inc. (GAP) is a leading global apparel retailer established in 1969, renowned for its strong portfolio of brands, including Gap, Banana Republic, Old Navy, and Athleta. Headquartered in San Francisco and operating in over 40 countries, the company emphasizes quality, style, and value to cater to a diverse customer base. In response to the evolving retail environment, Gap is aggressively pursuing digital transformation and sustainability initiatives, focusing on enhancing its e-commerce capabilities and introducing innovative product offerings to drive growth and maintain its competitive edge in the marketplace.
The Home Depot Inc
CONSUMER CYCLICAL · HOME IMPROVEMENT RETAIL · USA
The Home Depot, Inc., commonly known as Home Depot, is the largest home improvement retailer in the United States, supplying tools, construction products, and services. The company is headquartered in incorporated Cobb County, Georgia, with an Atlanta mailing address.
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