With improved employment levels and the housing market booming above 2006 levels, home improvement retail stocks have continued to grow. The Home Depot has outpaced the S&P 500 in the last 6 months, growing 39.3% versus the home improvement retail’s gain of 37.7% and S&P 500’s increase of 13.7%. The company attributes their success to maximizing square footage initiatives in current stores versus opening new ones, and focusing on the customer experience and buy online – deliver from store capabilities. Home Depot has been reporting strong numbers for the past 5 years, with record breaking year over year comps the past two quarters.
Back in October, The Home Depot stocks were trading at $163 and Lowe’s was only at $80, but since then Lowe’s is up 29% and Home Depot is up 21%. Home Depot has more physical stores in the US, with 2283 compared to 2144 at Lowe’s. Revenues through Q3 were much higher than Lowe’s but several other factors that can affect stock are looked at. As of Q3, gross margin for Home Depot was 34.1% and Lowe’s was 34.2%. Both CEOs are accredited for strategies that provide shareholder returns while minimizing risk. While The Home Depot’s revenues overall are higher, at $77B at Q3 compared to Lowe’s $53B, the average ticket is higher at Lowe’s, at $71.60 compared to Home Depot at $63.55.
Today Home Depot stock (HD) is reporting at $204.45 and Lowe’s (LOW) at $107.11.