It pays to be the leader in an industry. The company with the dominant market share tends to accrue outsize profits in its niche, after all, along with faster sales growth.

That's true even during a cyclical downturn, which is what the home improvement industry is experiencing right now. Both Home Depot's (NYSE: HD) and Lowe's (NYSE: LOW) businesses are shrinking today as consumers scale back on real estate spending. But in a recent earnings report, Home Depot gave investors a few reasons to feel more optimistic about its long-term outlook. Let's look at some key factors making the industry leader's stock stand out as the better buy.

Both companies reported a 2% decrease in comparable-store sales for the selling period that ended in late July. Look deeper into Home Depot's demand trends, and you'll see some encouraging signs of strength.

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Source Fool.com