Home Depot (ticker: HD), the U.S.’s largest home-improvement retailer, has been a Dow Jones Industrial Average (DJIA) mainstay since November 1, 1999. At that time it joined alongside tech titans Microsoft, SBC, and Intel as the Dow shed old-line names — Goodyear, Sears, Union Carbide, and Chevron.
Today, Home Depot holds a prominent place in the Dow Jones Industrial Average, making up about 6 percent of the index — the fourth-largest weighting, according to Slickcharts. That size shows just how much sway Home Depot has — when its stock moves, the whole Dow feels it. And because the company is steady and reliable, it acts like a stabilizer in the index, balancing out the riskier, fast-growth companies.
In this piece, Disruption Banking delves into just how much progress America’s beloved home improvement retailer made before its Dow inclusion and after, plus Home Depot’s core segments and e-commerce powering its growth.
Dow Debut: Riding the ‘90s Boom
Home Depot’s Dow debut coincided with the late-’90s tech boom. In effect, the Dow added Home Depot’s retail strength just as its stock had started to show excellent growth. Indeed, Home Depot shares spiked slightly above 100 percent in 1998 and another 42 percent in 1999, fueling its “impressive induction” into the blue-chip index, per Macrotrends. This led the price of Home Depot stock to hit $30 by end of 1999.
For perspective, Home Depot’s current stock price is about $412 at the time of writing. The inclusion cemented HD’s status as a bellwether for U.S. consumer and housing markets. As a legacy Dow Jones stock of over 25 years, Home Depot bridges the old economy (retail) with new strategies (e-commerce), underpinning the DJIA’s broad industrial base.
Stock Swings: Pre- and Post-Dow Glory
Before joining the Dow, Home Depot’s growth was explosive: 1990s annual returns were +77 percent (1997), +108 percent (1998), and +69 percent (1999). After its DJIA entry, HD traded through the dot-com collapse and housing downturns. It plunged about 33 percent in 2000 and a further roughly 52 percent in 2002, reflecting tech-led sell-offs and the early-2000s recession.
Albeit, Macrotrends’ data shows that Home Depot rebounded strongly (e.g. +49 percent in 2003) as the economy recovered. Since 2009 it has generally outpaced the slow-growth Dow cohort. For example, HD stock gained about 10.7 percent year-over-year (YoY) as of August last month, a performance at the high end among Dow Jones stocks in that period — tied as the third-best performer in the DJIA, for the month.
In recent quarters Home Depot has delivered modest growth with resilience. Q2 FY2025 (ended July) sales were $45.3 billion, up 4.9 percent YoY, while same-store sales rose just about 1.0 percent (U.S. comps +1.4 percent). Net earnings were flat at around $4.6B (EPS roughly $4.6). HD’s CEO, chair, and president Ted Decker noted the business benefited from customers taking on “smaller home improvement projects,” with Home Depot executing effectively to gain share.
Analysts at Zacks observed that despite earnings “misses” in Q2, investors cheered the reaffirmed guidance and modest comp growth. Overall, HD’s stock has shown lower volatility relative to fast-growing tech Dow Jones names, typical for a mature consumer firm, but when markets rally the company still delivers mid-to high-single-digit annual gains.
Growth Engine: Stores, Pros, and Digital
Home Depot’s core remains its 2,353-store DIY network across the U.S., Canada, and Mexico, but diversification has fueled growth. The retailer is expanding its Pro contractor business, highlighted by the $18.25 billion SRS Distribution deal, and plans to acquire GMS Inc. These moves bring more professional customers and heavy-building products like steel framing and drywall. Serving both homeowners and pros lets Home Depot capture complementary markets and the “lion’s share” of growth in smaller categories.
Digital strength is another moat. In Q2 2025, online sales rose 12 percent comps versus a 1 percent overall gain, thanks to machine-learning tools optimizing fulfillment and record same-day/next-day coverage. Faster delivery boosts spend per customer, reinforcing HD’s omnichannel edge. As Zacks noted, “Home Depot’s online edge appears increasingly hard to dislodge.”
In short, Home Depot’s Dow Jones stability rests on three pillars: steady retail, a fast-growing Pro segment, and a tech-enabled logistics network — each reinforcing the other.
Stabilizer with Scars: Dow’s Anchor Battles
The Dow Jones’ “low-beta” stocks are built to weather downturns, and Home Depot fits that defensive mold. It trails highfliers like Nvidia or Apple on the upside but steadies the index when markets wobble. As Kiplinger notes, Dow names “lag in up markets” but “hold up better when everything is selling off.” Home Depot adds that buffer with a fortress balance sheet and about 50 percent payout ratio — though not without legal battles and settlements along the way.
A whistleblower litigation brought in July 2005 under the Sarbanes-Oxley Act (SOX) law by former employee Michael Davis; a $6 million in cash and $8.5 million in common stock settlement that followed in 2008; Powell v. Home Depot USA, Inc. — a patent law controversy in 2011; a 2020 – 2021 $20.75 million suit for lead paint violations, and Home Depot big 2014 data breach settlement in 2016, are some major setbacks the Orange Apron company has faced.
Future Blueprint: Steadying the Dow
Looking ahead, Home Depot has reconfirmed moderate full-year guidance for FY2025 — about 2.8 percent sales growth and about 1 percent comps for the 52-week FY2025 (adjusted for the prior year’s extra week) — in line with a cautiously softening housing market. Nevertheless, the Orange Apron’s combination of niche leadership (DIY + Pro) and digital momentum suggests it will remain a Dow pillar.
Its heavy index weight ensures that Home Depot’s performance meaningfully influences the Dow’s stability.
In essence, Home Depot has hammered home its role in the Dow Jones; by blending steady returns with strategic growth investments, it continues to buttress the DJIA’s balance between yield and growth.
Makes you wonder how long Home Depot can keep that edge if the housing market keeps cooling.
#CapitalMarkets #HomeDepot #DowJones #DJIA #Home-improvementRetailer #HD #ecommerce
Author: Richardson Chinonyerem
The editorial team at #DisruptionBanking has taken all precautions to ensure that no persons or organizations have been adversely affected or offered any sort of financial advice in this article. This article is most definitely not financial advice.
See Also:
American Express’s Ascent: Powering Up the Dow Jones
How Sherwin-Williams (SHW) Stock Performed Before and After Joining the Dow Jones
