Skip to navigationSkip to main contentSkip to right columnADVERTISEMENTNeil Patel, The Motley FoolMon, August 10, 2026 at 12:50 PM GMT+2 3 min readThe home improvement industry has been under pressure in recent years. Macroeconomic headwinds, most notably elevated interest rates and above-normal inflation, have hurt demand for the two largest players, Home Depot (NYSE: HD) and Lowe's (NYSE: LOW).And these two retail stocks have underperformed the market. Home Depot shares are up 8% in the past three years (as of Aug. 7), while Lowe's shares have fallen 1%. Investors deciding between these two should focus on one key data point.Missed Nvidia in 2009? This Rare Signal Is Flashing Again. In 2009, a "Double Down" signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same "Total Conviction" signal is flashing for a company 1/100th the size of Nvidia. Continue »Here's one reason Lowe's may be a smarter buy than Home Depot before Aug. 19.Image source: Getty Images.A fresh financial update is on deckLowe's is set to report financial results for its fiscal 2026 second quarter on Aug. 19. Besides the obvious revenue and profit figures, investors should pay attention to some important information.Same-store sales increased 0.6% in Q1. It will be extremely encouraging to see this figure grow in the latest fiscal quarter, as it measures the performance of locations open at least 13 months.Trends for both do-it-yourself and professional customer cohorts will be insightful. The leadership team continues to expect pro demand to outpace DIY.Lowe's acquired Foundation Building Materials last October and Artisan Design Group in June 2025. Any commentary that management provides on cost synergies and integration progress will be valuable. This will indicate if these significant billion-dollar capital allocation decisions are bearing fruit.Valuation mattersOf course, investors shouldn't buy Lowe's stock to front-run the financial release on Aug. 19. This sort of urgency promotes short-term thinking. In the grand scheme of things, a single quarter's numbers have minimal influence on overall valuation.The best mentality is one that supports long-term ownership of businesses. This is the right philosophy to have. It allows compounding to work.That being said, Lowe's is a better stock to buy right now over Home Depot for one simple reason: it's cheaper. The former trades at a forward price-to-earnings ratio of 16.5, while the latter can be bought at a 22.3 multiple. This means that the market is offering Lowe's at a 26% discount to its larger rival. That's a notable disparity when their business models are almost identical.Terms and Privacy PolicyEU DSA contactPrivacy & Cookie SettingsMore Info