Lowes is the better long term play in my opinion. I have thought hard about this recently. HD is probably the better short term play due to the share buy back etc but Lowes will be opening more stores where HD is built out. The new stores same store sales likely won't be great but the housing market will pick up again and Lowes will kick ass. and rocket up again past HD. The stock is cheap and being disliked by Wall Street so I'm buying more now at a discount. I have time and patience.
I own twice as much HD as LOW - but I'm adding to my position in LOW and not to HD.
In the short run (12-18 months) I expect HD to outperform LOW because HD is not as focused on sales growth. Once we get past the concerns about deflation in the housing market I believe that LOW will outperform HD.
Both stocks are quite cheap given their business models and the fact that they have essentially become a duoply that will continue to take market share from the small hardware chains.
I started buying yesterday, i bought 4 times as much of low than hd, it is a hard call, low can have more growth than hd, but hd bought supply company this year and will add to sales, low has better store growth, It is a hard call, I will have a 1,000 shares of hd in my roth ira by next week and will not sell until 100 per cent profit, i am patient, the pe on hd is about 11 and they have more free cash to buy back stock, the pe on low is about 13-14 but the street may pay more for the growth, i like both , and they are a great hold longer term, the reason for the downgrade is due to new home sales and high fuel costs, that is garbage, the funds sell because they do not care IT IS NOT THEIR MONEY, they always over sell and always over buy, If you can buy a good stock like, low, hd, I bought aetna a few weeks ago at $31.00 new low and now over $37.00 another stupid move by the funds selling. I can go on and on, but do your homework and buy a good company both low and hd are good
I am at just over a 4:1 ratio as well LOW:HD and HEAVILY invested in LOW Started buying around $ 28 It quickly fell off the table right about then. I saw more opportunity than I saw risk, so I continued buying and am in for about 20K - shares that is . . . I am 75 % underwater right now, but $ 27.70 gets me back in the black. I think we see that next week given the irrational and overdone selloff in this stock the past week.