Retail

5 Stocks Poised to Win From Americans Moving to the Suburbs

The Floor & Decor second-quarter earnings consensus estimate has risen by a penny to $0.07 per share. The 2020 full-year estimate has increased to $0.84 per share from the previous estimate of $0.82, and the 2021 estimate is now $1.28 per share.

The $60 Jefferies price target was raised to $67, while the consensus target is $49.06. Shares closed at $57.20 on Monday.

Home Depot

This remains the undisputed leader in the home improvement retail category, and summertime is huge for the company. Home Depot Inc. (NYSE: HD) is the world’s largest home improvement specialty retailer, with 2,270 retail stores in all 50 states, the District of Columbia, Puerto Rico, U.S. Virgin Islands, Guam, 10 Canadian provinces and Mexico.

Home Depot stores sell various building materials, home improvement products, and lawn and garden products, as well as provide installation, home maintenance and professional service programs to do-it-yourself, do-it-for-me and professional customers.

Home Depot stockholders receive a 2.83% dividend. The Jefferies price target went to $285 from $275. The consensus price objective is $253.44, and shares closed most recently at $249.16.

Lowe’s

This company has a low 6% of foreign sales and is a top pick at Jefferies for the suburban flight story. Lowe’s Companies Inc. (NYSE: LOW) is a leading home improvement retailer with more than 2,000 stores in North America. The company has tempered its new store opening plans and is focusing investments on technology and e-commerce capabilities, in addition to improving its retail store productivity.

Lowes offers products for maintenance, repair, remodeling and home decorating. It provides home improvement products under the categories of kitchens and appliances, lumber and building materials, tools and hardware, fashion fixtures, rough plumbing and electrical, lawn and garden, seasonal living, paint, home fashions, storage and cleaning, flooring, millwork, and outdoor power equipment. The company also offers installation services through independent contractors in various product categories.

Investors receive a 1.62% dividend. Jefferies now has a $156 price target, up from $138, which compares with the $139.28 consensus target. Lowe’s stock was last seen trading at $134.72.

Wayfair

The combination of new homeowners and replacement buying by those already residing in suburbia could be huge. Wayfair Inc. (NYSE: W) is a multibrand e-commerce company that offers one of the widest selections of furniture, home goods, home decor and housewares online.

Wayfair brands include Wayfair.com, Perigold, Joss & Main, AllModern, Dwell Studio and Birch Lane. The company has more than 11 million active customers and has shipped more than 19 million orders in good years. With many customers using online shopping to replace home furnishings, Wayfair stands out as one of the largest and fastest-growing players in the business.

The whopping $223 Jefferies price target is up from $202. The consensus target is just $173.58, but Wayfair stock closed at $208.06.

The appeal of living in the city, especially the big cities like New York and Chicago has long held an allure, especially for young professionals climbing the ladder fast. Between the pandemic and the social strife, many just don’t feel safe, especially in crowded environments like mass transit. The move to the suburbs also will accelerate as work-from-home continues to grow.