Home improvement retailers remain in focus on Thursday after Hurricane Ian was reported to have left nearly 2.5 million without power in Florida.
Stocks that could get a sales boost
The damage in consequence of the tropical storm, as per Brian Sozzi – Editor-at-Large at Yahoo Finance could boost sales particularly at Home Depot Inc (NYSE: HD) and Lowe’s Companies Inc (NYSE: LOW).
Home Depot and Lowe’s in the Southeast operate a large part of their stores. In many respects, this is one of their largest markets.
The two stocks, however, are in the red this morning. Another name that Sozzi believes the Hurricane Ian could affect directly is Generac Holdings Inc – a Waukesha-headquartered company that makes backup power generators.
It’s worth mentioning that Wall Street also recommends buying these stocks and sees meaningful upside in all three from their current share prices.
These companies do well around hurricanes
Both Home Depot and Lowe’s have a history of seeing a significant boost to sales around hurricanes. Sozzi added:
Go back to Q3 of 2018. You saw their sales lift. When a big storm like Ian hits, it tends to lead a one-quarter sales and profit pop for both of these home improvement companies.
His outlook is the same as Michael Baker – Senior Retail Analyst at D. A. Davidson.
According to Enki Research (data modelling company), damage from Hurricane Ian in Florida could be worth as much as $67 billion. Home Depot and Lowe’s will likely be at the heart of that reconstruction.
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