Home Depot and Lowe's Q2 Earnings: A Motley Fool Senior Analyst Takes a Deep Dive
When long-term investors research a business, that research should (among other things) teach them as much as it can about the competitive landscape and industry in which the business operates. In other words, rigorous research on one company means also studying the competitors and the drivers of value for the industry as a whole. That’s why I've been grouping my earnings reports together this quarter.
You might remember earnings stories I filed earlier this month along these same lines. First, I reported on three mega-cap tech stocks (and honestly I wanted to include a fourth but that just made an already long article even longer). Then I put out a combined report on three IT services firms.
Today, I’m taking a look at the two largest home improvement retailers in the world. To best understand one, you should really follow and understand them both. Both companies serve a crucial economic need and are exceptionally well-run, profitable growers with wide moats. Home Depot (NYSE: HD) is the largest of the two and also, in my opinion, one of the best companies in the world. But Lowe's (NYSE: LOW) is another one of my favorites. It has structurally lower margins and returns on invested capital (ROIC) than Home Depot, but I still think it’s a great business and a great stock.
Source Fool.com
