Home Depot, Lowe's Report Modest Q2 Same-Store Sales Growth
Home Depot and Lowe's, the two titans of home improvement retail, have reported modest same-store sales increases in the second quarter. Home Depot led with a 1.4% rise, followed by Lowe's at 1.1%.
Over the past three years, Home Depot has outperformed Lowe's in stock gains, with 46.2% compared to Lowe's 33%. However, both have lagged behind the S&P 500's 83% growth. Despite this, Home Depot's ROIC of 27.2% is lower than Lowe's 29.5%.
Home Depot, with its larger store count (2,347) and higher annual sales ($159.5 billion), has a higher P/E ratio of 27, indicating greater growth expectations. The company is also expanding its professional contractor customer base through acquisitions and dedicated sales efforts. Meanwhile, Lowe's has 1,748 stores and $83.7 billion in sales, with a P/E ratio of 20.
The Motley Fool's Stock Advisor service, with a total average return of 1,058% compared to the S&P 500's 191%, does not currently recommend Home Depot stock. While ETFs like the Invesco FTSE Emerging Markets High Dividend Low Volatility show competitive long-term returns, a direct HD vs. LOW stock comparison requires detailed financial analysis.
Both Home Depot and Lowe's have shown modest same-store sales growth, with Home Depot leading in stock performance over the past three years. Despite underperforming the S&P 500, they remain strong players in the home improvement sector, with Home Depot's larger scale and growth expectations reflected in its higher P/E ratio. Further analysis is needed for a definitive comparison between the two stocks.
