Lowe’s vs. Home Depot (HD): Bernstein Crowns the Ultimate Home Improvement Stock for 2025

Wall Street's favorite pastime? Picking winners in the retail bloodbath. Bernstein just placed its bet—here's why one home improvement giant is leaving sawdust in the other's wake.

The Hardware Showdown

Forget inflation fears—Americans still can't quit their DIY addictions. But which mega-chain is actually turning those weekend warrior dreams into shareholder returns? Bernstein's analysts just cracked open the toolbox.

Margin Maneuvers

One retailer's supply chain upgrades are yielding surgeon-like precision, while the other's lumbering logistics drag down gross margins. Guess which one's getting downgraded to 'home improvement hobby stock' status?

The Cynic's Corner

Let's be real—both stocks still trade like they're priced by contractors who forgot to carry the decimal. But in a sector where 'growth' means convincing suburbanites they need $400 smart faucets, Bernstein's pick might actually weather the next housing slump. Maybe.

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Ma continues to favor Lowe’s over Home Depot in the NEAR to medium term, pointing to its cheaper valuation and stronger recovery potential once housing activity picks up.

Why Bernstein Prefers Lowe’s over HD

Ma said that Lowe’s is trading near an all-time high valuation discount to Home Depot, offering better relative upside. He expects Lowe’s to narrow its margin gap with Home Depot as the company executes on cost-saving initiatives that will likely offset higher investment spending.

He added that in the event of a housing market recovery, Lowe’s could rebound faster, thanks to its greater exposure to “big-ticket, discretionary spending categories.”

Home Depot Remains Steady but Fully Valued

While Bernstein raised the price target on Home Depot to $406, Ma maintained a Neutral rating, suggesting limited upside from current levels.

He said Home Depot needs around 3% comparable sales growth to drive operating leverage and offset rising costs, which may be difficult in the current environment of soft housing demand and persistent inflation.

Still, Ma noted that both Lowe’s and Home Depot are likely to be driven more by, such as inflation and interest rates, than by company-specific fundamentals in the near term.

Which Is the Better Home Improvement Stock?

Using TipRanks’ Stock Comparison Tool, we found that Home Depot carries a Strong Buy consensus rating, while Lowe’s holds a Moderate Buy rating from Wall Street analysts.

Both stocks have underperformed this year, with Lowe’s down about 6% year-to-date and Home Depot down roughly 5%.