Home improvement demand may cool next year, Lowe's prepares for industry correction!

Lowe's is one of several retailers that has seen sales boost as Americans have more time to do yard work, craft projects and redecorate homes during the pandemic . But the company warned that the strong pace could cool in the coming year .

The company said same-store sales could fall as much as 3% or remain roughly the same in fiscal 2022 compared with this year . However, Chief Executive Officer Marvin Ellison said his company could continue to drive growth by launching private-label brands, attracting more home professionals and making its e-commerce business faster and more efficient.

Same-store sales for the coming year will total between $94 billion and $97 billion, though that's below analysts' estimates.

According to foreign media reports, the company 's stock price has risen by about 60% this year , mainly due to strong demand for consumer housing regardless of peak or off-season. The retailer's market value now reaches US$173.52 billion.

Chief Financial Officer Dave Denton said the retailer expects its sales to outpace those of its competitors and volumes to continue to grow , but he also said the company is preparing for a modest industry pullback in 2022.

He also said the company can continue to drive growth by launching new private-label brands, expanding its e-commerce business and creating a one-stop shop to help seniors age at home , which are measures that will help its sales performance.

Meanwhile , the company will benefit from a favorable backdrop , including more money in consumers’ savings accounts, historically low interest rates, rising home values ​​and an aging U.S. housing inventory, he said. About two-thirds of the company’s sales come from repairs and maintenance, he said.

It is understood that the company plans to repurchase about $12 billion of shares this year and next year .

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Home Improvement