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The transition to the postpandemic period won’t be as unhealthy as feared for

House Depot and

Lowe’s, two corporations that benefited as Covid-19 led to a surge in house shopping for and renovations.

“We are actually extra assured {that a}) dangers of a major, transitional-type setback, for House Enchancment Retail and/ or its main gamers, have diminished, and b) underlying demand progress inside the house is apt to persist,” wrote Brian Nagel, lead analyst on an

Oppenheimer analysis report on the shares.

The agency upgraded

House Depot inventory (ticker: HD) to Outperform from Carry out and set a goal of $470 for the value. It raised its goal for

Lowe’s, additionally rated Outperform, to $300 from $235.

In early afternoon,

House Depot inventory was up 1.8% to $415.28. whereas Lowe’s gained 1% to $251.28. The

S&P 500
had gained 1.4%.

The report, printed Monday morning, mentioned the outlook for each companies stays robust even given prospects for a return to extra regular, postpandemic habits by shoppers in 2022. The housing market stays robust and the restricted provide of properties on the market is encouraging householders to rework their current properties, it mentioned.

Lowe’s stays the highest decide for Oppenheimer. “Inside house enchancment retail, we proceed to look most favorably upon prospects for LOW, owing to nonetheless vital “self-help” alternatives on the firm and a traditionally discounted relative share valuation,” Nagel wrote.

Early Monday afternoon, shares of House Depot have been up 56% 12 months up to now, whereas shares of Lowe’s had gained about 57%.

Write to Logan Moore at [email protected]