The ratings on Home Depot Inc. reflect the company's sizable position in the still-fragmented home improvement industry, intermediate financial profile, and considerable cash flow generation. The high exposure that U.S. home improvement retail has to the cyclical domestic housing industry, and expectations that the U.S. housing market will remain weak over the near-to-intermediate term partially offset these advantages. Home Depot, which pioneered the full-service, warehouse-style format in the 1970s, has retail operations with an annual revenue base in excess of $70 billion, and is almost twice the size of its nearest competitor, Lowe's Cos. Inc. At Aug. 3, 2008, Atlanta-based Home Depot operated more than 2,200 retail stores across the U.S., Canada, China, and Mexico. Standard&Poor's Ratings Services
