Dr. Amundson from Hawaii is precisely correct, molecular biologists
use the term "homology" to denote "common ancestry." In talking to
evolutionary biologists, it is my understanding that their use of
the term is precisely the same. However, evolutionary biologists
often refer to two distinct types of homology:
orthology - where the two sequences encode the same protein,
e.g. a myoglobin in a human and a myoglobin in a whale
paralogy - where the relationship between the two sequences
is not consistent with the phylogeny, e.g. myoglobin in a human
and beta-globin in a human (here, the ancestor of myoglobin
and hemoglobin is much older than recent ancestors of humans).
Evolutionary biologists discuss a similarity relationship that
is the converse of homology - analogy, or similarity due to convergent
evolution. It is my opinion there are no good examples of convergent
evolution based on protein or DNA sequence.
The main point, of course, is to distinguish between the
supposition - homology - and the fact - similarity or percent identity.