Home Depot's Cash Payouts Come with a Catch

Home Depot's (HD) cash payouts have been exceptional over the last five years, totaling $68 billion, or about 19.3% of its current market value.

This figure dwarfs the median S&P 500 company's return of $5.8 billion during the same period.

The majority of this capital came from direct dividend payments ($42 billion) and stock repurchases ($26 billion), which reduced the share count and increased each remaining owner's stake in the business.

However, despite these generous payouts, Home Depot's stock has underperformed the S&P 500 over the last year, with a return of -6.2% compared to the index's +22.0%.

The company's management notes that its Pro segment has been performing well, posting positive comps and outperforming DIY customers in recent quarters.