Fitch rates Home Depot notes A

Fitch Ratings said it assigned an A rating to the Home Depot, Inc.’s $2 billion offering of senior unsecured notes. Total issuance consists of $1.25 billion in 3.125% notes maturing 2049 and $750 million of incremental 2.95% notes maturing 2029, which were sold through a bond reopening.

The proceeds will be used for general corporate purposes, including repayment of upcoming debt maturities and share repurchases. Home Depot’s 2020 debt maturities include $1.25 billion and $500 million of notes due June and September, respectively.

Home Depot’s A rating and stable outlook reflect its scale and cash flow generation, coupled with its solid track record of comparable store sales growth and margin expansion. These factors, in combination with management’s financial policy commitments, instill confidence in Fitch’s forecast of adjusted debt/EBITDAR remaining at or modestly below 2x over the forecast horizon, the agency said.

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