Home Depot Has Raised Its Dividend for 17 Consecutive Years and Reports Earnings Aug. 18. Is It the Smarter Dow Stock to Buy Over Walmart?
2026-08-08 21:20
•Neil Patel •The Motley Fool
•••••••• •• Axe Cap view
Home Depot vs Walmart: Which Dividend Play Makes Sense for South African Investors?
Home Depot’s cheaper valuation and steady dividends appeal to income investors, but Walmart’s growth and diversification make it the stronger long-term bet.
Home Depot’s 17-year streak of dividend increases is impressive and rare, especially with 157 consecutive quarters of payouts. The stock trades at a more attractive valuation—about 37% cheaper than Walmart—making it tempting for those prioritizing income over growth. But Home Depot’s recent performance is sluggish, with just a 5% gain over five years and worsening same-store sales. It faces the usual cyclical pressures from rising interest rates and inflation, which can curb consumer spending on home improvement. Meanwhile, Walmart has delivered a strong 130% gain in the same period, buoyed by its push into e-commerce and high-margin advertising. As inflation bites South African consumers and retail banks tighten credit, look to how global consumer staples weather these shocks. Although Walmart’s valuation looks expensive, its resilience and innovation might better withstand economic uncertainty. If you’re chasing dividends alone, Home Depot has appeal. For broader growth with some income, Walmart leads. The key risk for both is unexpected shifts in US consumer behaviour that could spill into local USD/ZAR volatility, impacting South African investors. this is just our opinion and not financial advice
For dividend income, consider a modest exposure to Home Depot via global funds, but keep the bulk of US retail exposure in Walmart for more stable growth and resilience. Monitor USD/ZAR closely as currency swings could significantly affect returns.
- USD/ZAR
- Walmart
- Home Depot
- US consumer spending slowdown affecting retail stocks
- Sharp rand depreciation increasing currency risk for offshore investments
6/10
Home Depot and Walmart are compared as investment options. Home Depot has underperformed over five years (5% gain) due to cyclical pressures from higher interest rates and inflation, but maintains a strong dividend history with 157 consecutive quarters of payments and a higher yield of 2.67%. Walmart has outperformed significantly (130% gain over five years) with stronger fundamentals, diversified revenue streams from e-commerce and advertising, and a Dividend King status with 53 consecutive years of increases. Home Depot trades at a cheaper valuation (P/E of 24.8 vs. Walmart's 39.3), making it the better choice for dividend-focused investors despite Walmart's superior overall performance.
Our take is based on reporting first published by The Motley Fool.