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Home Depot, Lowe's Can Withstand Slowing Housing Market

Lower housing turnover is a headwind for the fairly valued home improvement retailers, but we still expect the companies to maintain their market leadership positions.

Home Depot, Lowe's Can Withstand Slowing Housing Market
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Jaime Katz: Wide-moat companies Home Depot and Lowe's both reported their fourth-quarter results this week, delivering same-store sales that were a bit lighter than we had forecast, spoiled by a wet winter and a difficult comparison to 2017's hurricane season. 

However, the outlook for the year ahead, with Home Depot calling for 5% and Lowe's predicting 3% same-store sales growth in 2019 implies the slowing improvement of the housing market hasn't hindered the ability for the market leaders to grow their top lines. 

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Jaime Katz does not own shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.