Dividend Growth: Home Depot Vs. Lowe's Companies

Oct 23, 2012 Full story: Seeking Alpha

Home Depot is about two and a half times bigger than Lowe's when it comes to market cap but these two companies are very similar in pretty much every other aspect when it comes to stock analysis.

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Spanish Mike Alvarez

Coplay, PA

#1 Oct 24, 2012
From the article...

Cash on Hand:

This is the first area where there seems to be a significant difference between the two companies. Home Depot's cash on hand is about 30% higher than Lowe's.

Market Share:

Despite being the industry leader, Home Depot is still gaining market share over Lowe's continuously.

Inventory Turnover:

Companies in this industry need to manage their inventories much better than in most other industries. Home Depot seems to be well managed in this aspect. Home depot has continuously outdone Lowe's in this regard and this trend is likely to continue, leading to outperformance.


Another example of Lowe's LEF being a dismal failure.

And the band played on as the Titanic sank.

You can't hire walmart cart pushers as managers and expect good results.

Dayton, OH

#2 Oct 24, 2012
I agree with you Spanish Mike. There is not one department who controls their own inventory. Some corporate buyer making a bonus check purchases for instance widgets and sends each store 6 displays or cases because they were a great price from the manufacturer. The issue is that this product has a velocity code of C. It will take a year to hopefully sell this product, thus tying up inventory dollars for every store. Then it rolls down hill with the department manager getting ripped due to excess top stock. How can Lowes survive purchasing ATG, and attempting to purchase Rona? The future is that cart pusher getting a code 50 from an internet order, not a full time associate selling it at store level.

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