Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

The Home Depot, Inc. (HD), Lumber Liquidators Holdings Inc (LL): Growth and Income Investors Should Feel Right at Home

Page 1 of 2

If you’re an investor looking for a stock that can offer you both growth and income, one name you should immediately add to your Watchlist is The Home Depot, Inc. (NYSE:HD). To say that Home Depot has regained its former glory would be an understatement as just a few years ago many wondered if the company was still a growth story. In the last several quarters not only has Home Depot proved that it can still grow at a good pace, but the company’s commitment to dividend increases has driven the stock price as well. With a better than 2% yield and more than 14% expected earnings growth, this might be one of the better growth and income stocks available today.

The Home Depot, Inc. (NYSE:HD)

Housing Is Helping but Management Should Get Most of the Credit

There’s no question that The Home Depot, Inc. (NYSE:HD) benefits as the housing market improves. As the largest purveyor of home improvement and contracting supplies, Home Depot is where homeowners begin their projects as new homes are built and sold or existing homes are upgraded.

What’s ironic is, even though Lowe’s Companies, Inc. (NYSE:LOW) operates over 1,700 stores compared to roughly 2,200 Home Depot locations, Lowe’s is clearly underperforming its larger rival. In the current quarter, overall sales at Home Depot increased by 7.4%, compared to a 0.5% decrease at Lowe’s. You would expect a better housing market to benefit both companies, but clearly customers are thinking of Home Depot first.

In addition, The Home Depot, Inc. (NYSE:HD)’s performance is particularly strong considering the increased competition from both general retailers like Wal-Mart Stores, Inc. (NYSE:WMT), and smaller specialty stores like Lumber Liquidators Holdings Inc (NYSE:LL). Wal-Mart seems to always be looking for a way to expand its business and in the last several years has expanded its home improvement selection. Lumber Liquidators Holdings Inc (NYSE:LL) is more of a specialty store that sells all types of flooring, but the company has been growing earnings and sales at a tremendous pace. With Wal-Mart squeezing prices on the low end and Lumber Liquidators offering a smaller and possibly more convenient environment, it’s surprising that Home Depot has done as well as it has.

Four Things That Make Home Depot Different From Peers

It’s one thing when companies give lip service to offering great customer service and reasonable prices, but it’s something else when a company actually delivers on these promises. Clearly, The Home Depot, Inc. (NYSE:HD) knows what its customers want as the company has consistently reported strong same-store sales growth. In fact, the only company to report faster growth in same-store sales is the much smaller Lumber Liquidators.

In the current quarter, Lumber Liquidators led the group with a same-store sales increase of 15.2%. By comparison, Home Depot reported same-store sales increased by 4.3%, whereas both Lowe’s and Wal-Mart showed a same-store sales decline. If investors want a great reason to consider sticking with, or buying, Home Depot’s shares, it has to be the company’s consistent same-store sales growth, even in difficult environments.

Page 1 of 2

Biotech Stock Alert - 20% Guaranteed Return in One Year

Hedge Funds and Insiders Are Piling Into

One of 2015's best hedge funds and two insiders snapped up shares of this medical device stock recently. We believe its transformative and disruptive device will storm the $3+ billion market and help it achieve 500%-1000% gains in 3 years.

Get your FREE REPORT and the details of our 20% return guarantee today.

Subscribe me to Insider Monkey's Free Daily Newsletter
This is a FREE report from Insider Monkey. Credit Card is NOT required.
Loading Comments...

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 102% in 3 years!! Wondering How?

Download a complete edition of our newsletter for free!