Home Depot (HD) Buys SRS Distribution, Reaches $1 Trillion TAM

Acquisition Details - Home Depot has completed the acquisition of SRS Distribution for an enterprise value of $18.25 billion, including net debt, funded through cash and debt [1] - This acquisition is expected to expand Home Depot's total addressable market (TAM) to $1 trillion, an increase of $50 billion [1] Strategic Growth Initiatives - Home Depot is executing its "One Home Depot" investment plan, focusing on supply-chain facilities, technology investments, and enhancing the digital experience [3] - The interconnected retail strategy has consistently boosted web traffic over the past few quarters [3] Performance of Pro Segment - The Pro segment has been a key growth driver, with robust sales growth observed over the past several quarters [4] - In Q1 fiscal 2024, Pro and DIY sales were nearly aligned, with Pro backlogs remaining healthy compared to historical trends [5] - The company is investing in Pro capabilities, including enhanced fulfillment and personalized online experiences, to deepen engagement with Pro customers [5] Market Reaction - Following the announcement of the SRS Distribution acquisition, Home Depot's shares rose by 1.3% [2] - Year-to-date, Home Depot's shares have rallied 17.4%, outperforming the industry growth of 11.3% [2]