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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.

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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. 

Jaime M. Katz does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.