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LOW vs. HD....
Old 05-02-2008, 09:03 AM   #1
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LOW vs. HD....

The perception, in my mind anyway, is that Home Depot is the place for professional builders and Lowe's is more home owner and especially women friendly. With that in mind, during a tightening market, shouldn't Lowe's outperform Home Depot right now because there is more home repair and less new housing going on?
Looking at the charts, it seems like LOW has developed a bit further along than HD, so does that mean HD is due for a move, or is LOW going to outperform for a while?
I've watched these two stocks for some time and tend to note that whichever stock has the lower P.E., it seems to catch up to the other.
Anyway, thoughts?
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Old 05-02-2008, 11:11 AM   #2
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Quote:
Originally Posted by Art G View Post
The perception, in my mind anyway, is that Home Depot is the place for professional builders and Lowe's is more home owner and especially women friendly. With that in mind, during a tightening market, shouldn't Lowe's outperform Home Depot right now because there is more home repair and less new housing going on?
Looking at the charts, it seems like LOW has developed a bit further along than HD, so does that mean HD is due for a move, or is LOW going to outperform for a while?
I've watched these two stocks for some time and tend to note that whichever stock has the lower P.E., it seems to catch up to the other.
Anyway, thoughts?
I guess that depends on who is doing the home repair. In my experience, contractors prefer Home Depot, while Harry Homeowner prefers Lowe's [I prefer Lowe's anyway]. And who is more likely to be doing the home repairs costing more than a couple hundred bucks? IMO, it's probably the contractor.

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Old 05-02-2008, 12:05 PM   #3
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Over the past 5 years there has virtually no difference in the stock price gains, or losses, between LOW & HD. LOW has an extremely small advantage but, nothing that makes much of a difference.

Flip a coin and pick either. Both should fair better than they have as housing improves.
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Old 05-02-2008, 05:19 PM   #4
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I would lean towards Lowe's because I feel Home Depot is still going to have management issues from the people Nardelli put in place.

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Originally Posted by BoutDone View Post
Over the past 5 years there has virtually no difference in the stock price gains, or losses, between LOW & HD. LOW has an extremely small advantage but, nothing that makes much of a difference.

Flip a coin and pick either. Both should fair better than they have as housing improves.
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Old 05-02-2008, 06:39 PM   #5
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I'd skip both, because they're going to stink for a couple of years.

Most of the professional contractors I know dont use either. They go with a small regional chain that gives them a nice discount and delivers quality product. Both HD and Lowes deliver all the crap wood and open boxes that the people going into the store wont buy.

Last time I got a truckload delivery from HD the wood was all crap, the water heater was propane instead of NG, and the paint was plain white instead of the custom color that I put a special order in for and went into the store the day before to make sure it was placed in the delivery bin at he pro desk so they wouldnt forget it.

It was still in the delivery bin when I hauled the five 5 gallon buckets of white and the water heater back into the store. Then when I was leaving with the right paint and WH, the door 'beeper' went off and the prodesk guy waved me through. Which was swell until the manager chased me down at the other end of the parking lot and made me haul it all back into the store so she could remove the beeper tag from the WH. In 110 degree weather.

The mickey-mousers and small contractors still do some shopping at HD, but thats because they're usually cheaper than Lowes. Thats been my experience anyhow.

By BIL the builder is getting all his new home business pulled or put off. Because he's one of the better builders, it took longer to hit him. He's expecting a year and half before he starts building again. It wont be until the foreclosures, loads of empty new homes, and the desperate resale backlog clears that new construction will kick back in. From what I've seen, people arent putting money into refurbishing their rapidly declining asset right now either and wont until things turn up a bit.
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Old 05-02-2008, 07:23 PM   #6
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Originally Posted by cute fuzzy bunny View Post
Last time I got a truckload delivery from HD the wood was all crap, the water heater was propane instead of NG, and the paint was plain white instead of the custom color that I put a special order in for and went into the store the day before to make sure it was placed in the delivery bin at he pro desk so they wouldnt forget it.

It was still in the delivery bin when I hauled the five 5 gallon buckets of white and the water heater back into the store.
A less honest person would have returned the white paint for a refund, then bought the custom-mixed paint from the "OOOPS" bin for 75% off.

I don't see a big difference between the several Lowes and HD around my house. The quality of help at Lowes tends to be better, they still have a few of the ex-tradesmen around--there are very few left at HD. I usually choose between the stores based on the particular experts in the particular departments.
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Old 05-02-2008, 07:38 PM   #7
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A less honest person would have returned the white paint for a refund, then bought the custom-mixed paint from the "OOOPS" bin for 75% off.
Brilliant. Never thought of it. Of course, having three painters standing in my kitchen waiting to paint the exterior sort of shortened up my possible options.

I buy paint off the oops shelf all the time. A lot of it is high quality exterior paint in not too nutty colors. For a couple of bucks a gallon I'm in. I paint my trailer bed with it, put a coat on my shed and then a second coat of a color I liked over the top, etc.
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Old 05-02-2008, 08:59 PM   #8
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HD is trading at a 12.72 multiple, and LOW is at 14.03. If you look at the analysts consensus 1yr target, HD has upside potential of 6.24% while LOW has 8.04%. But, HD has a higher divvie yield at 3.1% vs LOW's 1.3%. If you add their upside and their yield, they are both identical at 9.34%...so it seems to me that there is little difference.

I own both (picked them up in Jan). LOW is up 26.7% and HD is up 19.8% from where I bought. Taking the dividend into account, the YTD returns are 27.1% to 20.6%. If I were to do it again, I would have put a lot more into these two when I bought into them in Jan. Not sure how the return will be going forward, but if HD is for contractors and LOW is for Harry the Homeowner, I would probably go with LOW. I think homeowner improvements will come back before new construction will.

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Lowes versus HD
Old 05-24-2008, 07:25 AM   #9
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Lowes versus HD

I can only speak about my particular town -- but I just went to but a ton of stuff and I compared prices at both HD and Lowe's -- and HD was cheaper for every item. Guess where I'm doing business in the future.
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Old 05-24-2008, 09:25 AM   #10
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Only thing I've found cheaper at Lowes in my area is a box of galvanized ring nails for a nail gun were $83 at lowes and $89 at HD.

I made a $4000 lumber and concrete order from Lowes three days ago. I got called the next day to say "The truck broke down". At first I thought I might be involved in a monty python skit.

"So...Lowes corporation only has one truck?"

"Well, we only get one per store and the other stores wont release theirs for us to use".

To make a long story short, I had to call the store manager to tell him that I had five contractors sitting around with their hands in their pockets costing me $1000 a day. He didnt seem to much care. At 2 in the afternoon they finally showed up, more than 48 hours after making the order.

I cant remember ever ordering a bunch of stuff from a building supply store and not getting it at zero-dark-thirty the next morning.

I ended up hauling several tons of concrete and 4x4's on my trailer to keep the crew going. From home depot.
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