下面是小编为大家整理的美国硬线零售：打造梦想家园,供大家参考。
G l o b al R e sear c h
6
A u g u st 2020
U .S .
H a r dlin e s
R e t a il
H D
/
L O W:
B u i ld i n g
A
Dr eam
H om e
H D
and
L O W
a r e
set
t o
r e p o r t
st r o n g
d o ub l e
d i g i t
co mps
f o r
2 Q
Wh il e
i t" s
w i d el y
b el i ev ed
th at
ho me
i mpro ve men t
( HI )
h as
b een
a
c ateg o ry
o f
s tren g th , w e
t hi nk
t he
m a gni t u de
of
t he
ga i ns
&
t he
f l ow t hrough
w ill
be
e nc our a gi ng
t o
t he market.
A
c ombo
o f
w a llet
s h are
s h ifts ,
s uppo rti ve
w eath er,
&
s ti mu l u s
li kel y
dro ve de m a nd
i n
2Q .
T he
C ensus
H I
ca t e gor y
gr e w
17. 2%
i n
M ay / J une
( v s .
6. 7%
i n
1Q ) w h il e
th e
UB S
Ev i d en ce
L a b
hou s i ng
s u rv ey
s how s
66%
of
ow n ers
w ere
p l an n i ng pro j ec ts . B o th
o f
th es e
d ata
po i n ts
h i gh li gh t
s tro ng DI Y
tren d s . Pl u s , t h e
Pr o s egme n t i mpro v ed
i n
2 Q
as
w el l .
The
NAHB
R emo d el i ng
I nd ex
acc el erated
w .
th e
c u rren t c ondi t i on i n de x
c om i ng i n a t
77 v s . 58 i n 1Q
( de t a il s
w i t hi n) . F ur t he r, mo s t
HI
v en do rs po i n ted
to
s tro ng tren d s
i n Ju n e/ Ju l y
d es p ite
th e
UB S
V en dor I nd ex
( ~80 %
c o rrel . w i th HD/ L O W SSS)
d ec li n i ng -5. 0%
i n 2Q
v s . +1.6 %
i n 1Q
( ve ndor s ’
Q s
s panne d Apr- J un) . The
UB S
Ev i d en ce
L a b M 2m fo rec as t
c al l s
fo r 10.4 %
SSS
at
HD
& 12.6 %
SSS
at
L O W ( th ere" s
li kel y
room fo r up s i d e) . F i n al l y , th e
w eath er
w as
s uppo rti ve
o f
ou td oor pro j ec t s i n
2 Q .
O v eral l ,
w e
b el i eve
rep o rti ng
s tr ong
2 Q
res u l ts
w ill
l ead
t o
s h arp l y
h i gh e r es ti mate
rev i s i on s
fo r bo t h HD/ L O W, d ri v i ng t h e
s to cks
to
ap p rec i ate
( bo th
are
tradi ng b el o w
h i s to ri c al
l ev el s
rel ati ve
to
th e
S&P) . W e
b el i eve
H D " s
t o p - li n e
ac c el er ated n i c el y
vs .
1Q
W e
m ode l
14 %
SSS
( c ons .
6. 7% ; buy - s i de
ba r
15% -20 %) .
O ur
es t.
b akes
i n a
20 % i n crease
i n DI Y
s eg men t
( 55 %
o f
s al es)
an d a
7-8 %
i n crease
i n Pro
( 45 %
o f
s al es) . Per p l ac er. ai ,
fo o t
traffi c
i n
HD" s
s to res
w as
up
22 % ,
on
av g,
i n
2 Q
( v s .
-3.9 %
i n
1Q ) . F u rth er,
w e
fo r ec as t
5 bp s
o f
O M
ex p an s i on d ri v en
b y
SG &A l ev erag e
( w e
mod el
-15 bps
of
G M
c on t r ac t i on) . O ur 2 Q
EPS
fo rec as t
i s
$3.74 ( c on s . $3.41 ) . O ur ex p ec tation i s th at
HD
w ill
po i n t
to
a
c on t i nu ati on o f
s tro ng tren d s
i n to
Aug. O ur n ew
p ri ce
target
o f
$300 ( w a s
$28 0)
i s
ba s e d on 2 3x
our ne w
CY " 22E
EPS
e s t i m a t e
L O W
li k e l y
o u t co mp e d
H D
a g a i n
i n
2 Q
W e
mod el
17 %
SSS
( c ons . 10% ; b uy - s i de
2 0% + ) . O ur f or eca s t
buil ds
i n a
20%
c omp fo r M ay
& a
~15 %
SSS
fo r Ju n e
& Ju l y . Per
p l ac er. ai , fo o t
tra ffi c
i n L O W s to r es
w as
up 35%
on av g i n 2Q
( v s . 7. 5%
i n 1Q ) . F ur t he r, w e
m ode l
a
130 bp O M
i nc r ea s e
( c ons . 65 bps ) ,
dr i ve n
by
70
bps
of
G M
ex pa ns i on
a nd
-60
bp s
o f
SG &A
l ev erag e
( d es p i t e ex pe c t i ng
S G &A
doll a r s
t o
c li mb
$525
mm
Y oY ) .
O ur
2Q
EPS
e s t .
i s
$2.90
( c ons . $2. 63) . O ur ne w
P T
of
$180 ( w a s
$14 0)
i s
b a s e d on 1 9x
our CY " 22 EPS
e s t . ( w a s
18x CY " 21 EPS
es t. ; mo re
d etai l s
w i th i n) . Mi ch ael
Lasser
A na l ys t mi cha e l.l a ss e r @ ubs .com
+1 -212-713
2440
A t ul
M ahes w ar i , C FA Assoc i a t e
An a l y st a t ul.m a he s w a ri @ ubs .com
+1 -212-713
4103
M ar k Car den
A na l ys t m a rk .ca r de n@ ubs .com
+1 -212-713
3218
F i g u r e
1 :
HD
& L O W
YoY
foo t
tra ffi c
g ro wth
F i g u r e
2 :
HD
& L O W
N TM
P/E
vs
S& P
500
1.5 x
4 5%
3 5%
2 5%
1 5%
5%
-5 %
- 15%
- 25%
27- J a n 27- F e b 27-Mar 27-Apr 27-Ma y
27- J un 27- J ul
LO W HD
1.4 x
1.3 x
1.2 x
1.1 x
1.0 x
0.9 x
0.8 x
0.7 x
0.6 x
J u l -15
Ja n-16
J u l -16
Ja n-17
J u l -17
Ja n-18
J u l -18
Ja n-19
J u l -19
Ja n-20
J u l -20
S our ce : Pl ace r. ai
S our ce :
F ac t set
www .u b s.co m / i nvestm ent r esea r ch
Th i s
rep o rt
h as
b een
p repared
b y
UB S
Se c u ri ti es
LLC .
ANALYS T
C E R T I F IC AT I O N
AND
R E Q UI R E D
DIS C L O S UR E S
B E G I N
O N PA G E
41 .
UB S
do es
an d s eeks
to
do
bu s i n es s
w i th
c omp an i es
c o v ered
i n i ts
res earc h r ep o rts .
As
a
re s u l t , i n v es t o rs
s hou l d b e aw are
th at
th e
fi rm may
h ave
a
c on fl i c t
o f
i n teres t
th at
c ou l d affec t
th e
ob j ec ti v ity
o f
t h i s
rep o rt.
I n ve s to rs
s hou l d c on s i d er
th i s rep o rt
as
on l y
a
s i ng l e
fac to r i n maki ng th ei r i n v es tmen t
d ec i s i on. Ret ai l er s , Br oad li ne
Am er i cas
Equit ies
HD
a nd LO W " s
re la tive
p re m ium
to
the S& P
500 h as
c on t r ac t ed
l at ely
an d i s b e low his torical
leve ls
HD
v s . S& P
Sp r ead
L O W v s . S& P
Sp r ead
S umma r y
W e
be li e v e
t ha t
t he
hom e
i mpr ov e m e nt
c a t e gor y
s a w
r obus t
t r e nds
i n
2Q
dr i v e n by
w a ll e t
s ha r e
s hi ft s
a nd
gov e rnm e nt
s t i mul us .
C e n s u s
Bur ea u
r e t ai l
s ale s
dat a
f or t he
c a t e gor y
poi nt s
t o
s t rong
t r e nds
w i t h
a
17. 2%
i nc r ea s e
i n
M a y / J une
( v s .
6.7 % i n
1Q ) .
F ur t he r,
pe r
pl a c e r. a i ,
f oot
t r a ff i c
w a s
up
35 %
Y o Y
i n
2Q
a t
L O W " s
s t or e s ( v s .
7.5 %
i n
1 Q ) ,
a nd
up
22 %
a t
HD " s
s t or e s
( v s .
- 2%
i n
1Q ) .
N A H B
R e m odeli ng I nde x
i ndi c a t e s
t ha t
s e nt i m e nt
a c r os s
i ndus t r y
pa r t i c i pa nt s
i mpr ov e d
m ea ni ngf ul l y i n
2Q
a s
bot h
c urr e nt
c ondi t i on
inde x
&
f ut ur e
i ndi c a t or
inde x
a cc e l e r a t e d s e que nt i a ll y .
C ommodi t y
i nf l a t i on
w a s
li k e l y
a l s o
s uppor t i v e
w i t h
l um be r
pr i c e s
up 34. 9%
Y oY .
F i na ll y ,
c oop e r a t i v e
w ea t he r
li k e l y
dr ov e
out door
proj e c t s .
W i t h r e s pe c t
t o
c ha nnel s ,
w e
be li e v e ,
t he
D I Y
s e gm e nt
w i t ne ss e d
c ont inue d
s t r e ngt h w hi l e
t he
P ro
c ha nnel
i mpr ov e d
s e que nt i a ll y ,
e s pe c i a ll y
i n
t he
l a tt e r
ha l f
of
2Q .
W e m odel
14%
SSS
f or
HD
( c on s .
6. 7% )
a nd
a
17. 0%
c omp
f or
L O W
( c on s .
10. 0% ) .
W hat " s
t h e
r ead
t h r o u g h
f r o m
s eve r al
U B S
Evi d en c e
L ab
w o r k
and
a pr opr i et a r y
U BS
s t udy ?
T he
U BS
Ve ndor
I nde x
highl i ght e d
t ha t
v e ndor
s a l e s gr ow t h
de c e l e r a t e d
t o
-5.0 %
i n
2Q
v s .
1. 6%
i n
1Q .
T ha t
s a i d,
t he r e " s
li k ely
s om e di v e r genc e
be t w ee n
I nde x
a nd
HD / L O W
pe r f orm a nc e
gi v e n
v e ndor s "
2Q
s pa nne d f rom
Apr il
t hrough
J une
( HD / L O W " s
2 Q
s pa nne d
f rom
M a y
t o
J ul y ) .
I mpor t a nt l y , m os t
v e ndor s
highl i ght e d
s t rong
t r e nds
f or
J une ,
w hi c h
c ont inue d
i nt o
J ul y . Ve ndor
s a l e s
ha v e
hi s t or ica l ly
h a d
a n
80 %
co rr ela t ion
w it h
HD
&
L OW" s
SSS . F ur t he r,
t he
m os t
r e c e nt
U BS
E v i de n c e
L a b
Hous i ng
I nt e nt i ons
s ur v e y
of
2k i ndi v idual s
h i ghl i ght e d
t ha t
66%
of
hom e ow ne r s
e x pe c t e d
t o
do
a
hom e i mpr ov e m e nt
proj e c t
i n
t he
ne x t
3
m ont hs ,
i n
li ne
w i t h
l a s t
y ea r.
T hi s
s how s
t ha t c ons um e r s
r e m a i n
e nga ge d
i n
t he
c a t e gor y ,
w hi c h
s hould
bode
w e ll
f or
t he
s e c t or a s
hom e
ow ne r s
s pe nd
mor e
t i m e
a t
hom e .
T he
t op- dow n
U BS
E v i denc e
L a b Ma c ro- to -m i c ro
m odel
e s t i m a t e s
a
c omp
of
10. 4%
f or
HD
a nd
12. 6%
f or
L O W.
F oo t
tra ff i c
ac c el er a t ed
seq u en t i al l y
at
b o t h
H D
and
L O W
du r i n g
t h e s e c ond
qua r te r .
HD
a nd
L O W
s a w
i nc r ea s e d
f oot
t r a ff i c
t ow a r ds
t he
e nd
of
1Q
a s s hut dow n
ord e r s
w e r e
e na c t e d.
T hi s
c ont i n ue d
i nt o
2Q .
D ur i ng
t he
r e t a il e r s "
f i s c a l s e c ond
qua r t e r s ,
f oot
t r a ff i c
a cc e l er at ed
m ean ing f u ll y
o ve r a ll
vs .
1 Q .
S p e cif ica lly, f oot
t r a ff i c
i nc r ea s e d
on
a v e r a ge
35%
Y oY
a t
L O W
( v s .
7. 5%
i n
1Q ) ,
a nd
22% Y oY
a t
HD
( v s .
-1. 8%
i n
1Q ) ,
r e s pe c t i v e l y ,
i n
2Q " 20.
F i g u r e
3 :
Y ear - o ver - y e a r
foo t
tra ffi c
c han g e
a t
HD
and
L O W
50%
25%
0%
-25 %
27- J a n
10- Fe b
24- Fe b
09- M a r
23- M a r
06-Apr
20-Apr
04- M ay
18- M ay
01- J un
15- J un
29- J un
13- J ul
27- J ul
LOW
HD
S our ce :
Pl ac er.a i
HD
a nd
L O W " s
a v e r a ge
mul t i pl e
i s
c urr e nt l y
a round
21. 5x
on
a v e r a ge
( HD " s
N T M P / E
i s
23. 6x
v s
L O W
a t
19. 5x ) ,
mor e
t ha n
2x
a bov e
t he
a v e r a ge
mul t i pl e
a t
t he
e nd
of
1Q .
S i n c e
2014,
t he r e
ha s
be e n
a
- 29%
c orr e l a t i on
be t w ee n
t he
c ha n ge
i n
HD &
LO W" s
N T M
P / E
a nd
t he
c ha nge
i n
t he
10- y ear
Tr eas ur y
rat e
(th e
10- y r
Tr eas ur y ha s
de c li ne d
-140
bps
s i nc e
J u l y
2019) .
F...