5 Retailers Thriving With The Strong Housing Market

five 3-storey houses in-lined on street

As consumers continue to spend more on renovating and decorating their homes, and the new-house purchase trend amid the low interest rate environment continues unabated, the red-hot housing market could drive solid price gains in the coming months for the stocks of Lowe’s Companies (LOW), At Home Group (HOME), The Container Store Group (TCS), Lumber Liquidators Holdings (LL), and Tile Shop Holdings (TTSH). So, we think it’s wise to scoop up these stocks now. 

The current low interest rate environment and the desire to move to bigger and better living (and working from home) spaces have driven increased demand for new houses over the past year. This, along with a renovation and remodeling trend to make current homes more comfortable for living and working, has led to rising demand for home improvement products, such as furniture, wall art, and even garden and outdoor decors.

According to a Brandessence Market Research report, the home improvement market is expected to reach $1155.79 billion by 2026, growing at a CAGR of 4.5%.

Because most  retailers in this space have increased their online presence, their products and services have become much more accessible to a wider range of consumers. For the reasons stated above, we think it  wise to bet on Lowe’s Companies, Inc., At Home Group Inc., The Container Store Group, Inc. , Lumber Liquidators Holdings, Inc. , and Tile Shop Holdings, Inc. They sell related products and services and we think are well positioned to capitalize on the industry tailwinds.

Lowe’s Companies, Inc.

Together with its subsidiaries, LOW operates as a home improvement retailer internationally. The company offers products for construction, maintenance, repair, remodeling, and decorating. It operates more than 1,974 home improvement and hardware stores and sells its products through its websites and mobile application.

In March, LOW and Chevron announced the  launch of FLEX , a line of cutting-edge, cordless power tools. They are powered by a new FLEX 24V lithium-ion battery platform, which delivers 20% more power than competitors and  provides faster recharging. The company’s sales are expected to increase with the help of this innovative product.

The company’s total revenues increased 26.9% year-over-year to $20.30 billion for the fourth quarter, ended January 29. Its net earnings have ncreased92.1% year-over-year to $978 million, and its  EPS increased 100% year-over-year to $1.32.

For the quarter ending April 30, analysts expect LOW’s EPS and revenue to increase 41.8% and 26.8%, respectively,  year-over-year. It surpassed the Street’s EPS estimates in three of the trailing four quarters. The stock has gained 86.9% over the past year and closed yesterday’s trading session at $198.44.

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Craig Newman 1 week ago Member's comment

$TCS is thriving? Where?