Why Home Depot and Lowe's Will Come Back Strong
The coronavirus pandemic has taken its toll on people's health, obviously, and this is everyone's primary concern. However, efforts to slow its spread have also wreaked havoc on the economic health of many countries, including the U.S., causing concern among investors. The financial well being of Lowe's (NYSE: LOW) and Home Depot (NYSE: HD) is closely tied to that of the overall economy. As such, each company's stock price has taken a hit, dropping about 22% and 18%, respectively, just since the start of March.
Both are reliant on the United States for the bulk of their revenue, representing 93% of Lowe's and 92% of Home Depot's fiscal 2019 sales. With unemployment claims skyrocketing to over 3.3 million for the week that ended on March 21, clearly, the virus is hurting the domestic economy.
While Lowe's and Home Depot's revenue is likely to be negatively affected by people pausing home purchases and major projects, there are reasons investors should feel optimistic.
Source Fool.com
