3 Expensive DIY Stocks to Watch

These overvalued names are well positioned to benefit from the staying power of the DIY trend, a switch in consumer spending patterns, and an acceleration in home building activity

Vikram Barhat 26 August, 2020 | 12:59AM

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Faced with social distancing, shelter-in-place, work-from-home and other pandemic-led restrictions, homebound consumers have shifted their attention to domestic DIY projects. The trend has pushed the demand for home improvement products and services higher.

Year-to-date, the Dow Jones US Home Improvement Retailers Index has soared nearly 30% (in U.S. dollar terms), compared with a 4% gain for the S&P 500 index, and the Dow Jones Industrial Average’s loss of 4%, as of August 20.

Leading home improvement retailers have reported robust sales growth in recent months. They are well positioned to benefit from the staying power of the DIY trend, a switch in consumer spending pattern during the pandemic, and a reacceleration in homebuilding activity. However, given the elevated valuations of these stocks, investors may want to patiently wait until a meaningful pullback creates an attractive entry point.

The Home Depot Inc

Ticker

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Securities Mentioned in Article

Security NamePriceChange (%)Morningstar Rating
Lowe's Companies Inc160.10 USD-2.25
Sherwin-Williams Co695.49 USD-2.39
The Home Depot Inc275.19 USD-1.70

About Author

Vikram Barhat

Vikram Barhat  Vikram Barhat is a Toronto-based financial writer specializing in investing, stock markets, personal finance and other areas of the financial services industry. He also writes for CNBC, BBC, The Globe and Mail, and Toronto Star.

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