Fitch Ratings on March 28 affirmed its long-term issuer default rating for Home Depot Inc. at A, with a stable outlook.

The ratings agency said the move reflects the home improvement retailer's performances in comparable store sales growth and margin expansion, noting that they have shown growth each year since 2010. The affirmation is also based on the company's scale and cash-flow generation.

However, Fitch expects EBITDA margins to drop 10 to 20 basis points due to the retailer's investments in its One Home Depot strategy targeting infrastructure technology, the supply chain and in-store improvements. Home Depot expects to spend about $11.1 billion on the business plan over three years.

The agency also said it expects the retailer to produce comparable store sales in the 2% to 3% range, while its EBITDA margin is expected to remain between 16% and 17%. EBITDA is projected to generate annual free cash flow of $5 billion to $5.5 billion after dividends in the $5 billion to $6 billion range.