Home Depot Promises Yearly Dividend Increases and Targets 40% Payout Ratio

Home Depot (NYSE: HD) has made no secret of it's dividend intentions. According to yesterday's released 4th quarter and FY 2010 results, "As a testament to our confidence in the Company's strategic initiatives and our commitment to returning capital to our shareholders, the board increased the dividend for the second consecutive year," said Blake. "It is our intent to increase our dividend every year. Our longer-term targeted dividend payout ratio is 40 percent." 2010 was a good year for Home Depot, the world's largest home improvement store. Comparable store sales were up 4.8% this year, and total sales were up 2.8% to 68 billion. This is the first year of positive sales growth since 2006. As of 2010's unaudited numbers, the payout ratio was 47%, which is very close to their proposed goal. Free cash flow of 3.5 billion is more than enough to cover the 1.6 billion they paid... Read more