TRG | The Bottom Line – 5/14

Next week earnings includes that of DIY companies, Home Depot (HD) and Lowe’s (LOW). A year ago at this time, manageable home renovation projects (think interior painting projects) and yard and garden projects were all the rage in the heart of the COVID-19 quarantine. HD and LOW stocks have moved 123% and 185%, respectively, versus an S&P 500 increase of 87% over the same time period. As the U.S. residential housing boom builds, the resi housing focus has shifted to new home construction and more significant home renovation projects (i.e., Home expansions & additions), which will feed additional demand for DIY projects that so often happen with any home move or renovation. Next week, TRG will focus on how big box is managing both rampant inflation and supply chain disruptions, in addition to understanding the cadence of demand for key DIY products, materials, appliances and services. In the spirit of the DIY-times, this analyst has now ingratiated herself with neighbors and friends alike with the recent purchase of a pickup truck.