Home Depot Yields More Than 3x the S&P 500. Here's the Effect on a $10,000 Investment.

Source Motley_fool

Key Points

  • The home improvement retailer's quarterly dividend payout has soared 238% in the past 10 years.

  • Investors will appreciate the consistency, as the business has paid a dividend in 158 straight quarters.

  • 10 stocks we like better than Home Depot ›

Home Depot (NYSE: HD) hasn't been on the winning team. Its shares are down 29% in the past 12 months (as of Sept. 24), and they currently trade 32% off their peak from December 2024. Macro headwinds have seriously pressured the company's growth, harming investor sentiment.

However, the retail stock pays a healthy dividend that currently yields 3.19%. This can satisfy income investors, and it's more than triple the 1.05% yield that the S&P 500 index pays.

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Here's the effect of that yield on a $10,000 investment.

Home Depot logo on orange filter with employee in background.

Image source: The Motley Fool.

If you simply buy an S&P 500 exchange-traded fund, that hypothetical $10,000 capital outlay would generate $105 in annualized income. Investors who are after a passive income stream aren't lining up to add the benchmark to their portfolios.

Home Depot is the better choice in this regard. That same $10,000 invested in shares of the leading home improvement company would result in $319 in yearly income. That's significantly more than what the S&P 500 index would bring in.

The massive retailer's payout has also grown. In the past decade, Home Depot has increased its quarterly dividend by 238%.

The consistency is even more impressive, however. The business has paid a dividend in 158 straight quarters. Home Depot's ability to return capital to shareholders through various economic scenarios is a wonderful trait.

Should you buy stock in Home Depot right now?

Before you buy stock in Home Depot, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Home Depot wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $383,680!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,382,954!*

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*Stock Advisor returns as of September 26, 2026.

Neil Patel has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Home Depot. The Motley Fool has a disclosure policy.

Disclaimer: For information purposes only. Past performance is not indicative of future results.
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