Although home improvement projects have dropped from the highs of the pandemic, the record low supply of homes coupled with high mortgage rates are likely to boost the demand for home improvement projects. Homeowners will likely undertake renovation and remodeling services rather than buying new homes.
Given this backdrop, it could be wise to add fundamentally strong home improvement stocks: Tile Shop Holdings, Inc. (TTSH – Get Rating), Lifetime Brands, Inc. (LCUT – Get Rating), and Steelcase Inc. (SCS – Get Rating) to one’s portfolio.
Before diving deeper into the fundamentals of these stocks, let’s discuss why the home improvement industry is well-positioned for growth.
Home improvement was one of the top priorities during the pandemic as people were stuck indoors with very few options to spend their money on. Surplus cash and work-from-home orders drove home improvement projects. However, home improvement projects have slowed significantly since then due to the uncertain macroeconomic conditions.
With high home prices, a tight supply of homes, and mortgage rates hovering around 8%, prospective homeowners will likely drop plans to own a house and instead spend on home improvement projects, boosting demand for home improvement companies.
The long-term prospects of the home improvement industry look good due to rising disposable income, DIY projects, aging housing stock, etc. The growing popularity of DIY home improvement projects is expected to boost the global DIY home improvement retailing market. It’s forecasted to achieve steady growth with a consistent 4.4% CAGR, resulting in around $1.28 trillion in revenue by 2030.
The global home improvement market is booming thanks to the growing interest in smart homes and heightened security needs. Advancements like the Internet of Things (IoT) and AI are shaping market trends. The home improvement market is projected to grow at a CAGR of over 5%, reaching $423.90 billion by 2027.
Considering these conducive trends, let’s analyze the fundamental aspects of…
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