HD vs MCD: Which Is the Better Buy?
Side-by-side comparison of The Home Depot, Inc. and McDonald's Corporation — fair value, conviction, valuation metrics, and QuantHub research signals.
Updated 2026-07-20.
The Home Depot, Inc. · Consumer Cyclical
$343.30
+34.6% upside to fair value
Grade A
High Quality
VS
McDonald's Corporation · Consumer Cyclical
$267.71
+20.6% upside to fair value
Med Conviction
Grade C+
High Quality
QuantHub Verdict
HD has more upside to fair value
(+34.6%).
These are model outputs — not personalized investment advice.
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Valuation & Fundamentals
| Metric |
HD |
MCD |
| Current Price |
$343.30 |
$267.71 |
| Fair Value Estimate |
$462.14 |
$322.85 |
| Upside to Fair Value |
+34.6%
|
+20.6%
|
| Market Cap |
$342.3B |
$190.2B |
| Forward P/E |
24.3x
|
—
|
| EV / EBITDA |
16.5x
|
16.4x
|
| Price / Sales |
2.0x
|
6.9x
|
| Price / FCF |
23.9x
|
27.0x
|
| Revenue Growth YoY |
+4.8%
|
+9.4%
|
| Gross Margin |
33.1%
|
57.4%
|
| Operating Margin |
12.4%
|
46.0%
|
| Return on Equity |
113.3%
|
-433.9%
|
| Dividend Yield |
0% |
2.75% |
| FCF Yield |
4.18%
|
3.7%
|
| Analyst Consensus |
Buy
|
Buy
|
Investment Thesis
The Home Depot, Inc. operates as a leading home improvement retailer in the consumer cyclical sector, leveraging a strong brand and cost advantages to maintain a durable competitive moat. Despite a modest revenue growth of 4.8% and a decline in earnings by 4.2% in the most recent quarter, the company exhibits exceptional profitability metrics including a 113.3% return on equity and solid margins …
McDonald's is a global quick-service restaurant franchisor and real-estate platform whose approximately 95% franchised restaurant base generates unusually high-margin, recurring royalty and rent income, supporting a 46.0% operating margin and 31.6% net margin. Business quality is high because its brand, global purchasing scale, nearly 29,000 drive-thrus, digital ecosystem and 210 million 90-day a…
Accumulation Zones
| Metric |
HD |
MCD |
| Zone Low |
$346.61 |
$242.14 |
| Zone High |
$392.82 |
$274.42 |
| In Buy Zone? |
Yes
|
Yes
|