With another potential hurricane likely to hit Florida, investors may want to consider home improvement stocks, like Lowe’s Companies (LOW).
After Hurricane Ian ran through Florida, “Nicole” could make landfall next. Right now, all we know is that Nicole is a subtropical storm that could first become a hurricane over the Bahamas before moving on to Florida’s east coast.
“Unfortunately, this is going to be a very large storm, with a very large wind field on the north side. This is going to cause quite substantial surf, potentially dangerous storm surge somewhere along the Florida east coast, and heavy rainfall and probably significant winds over a large area,” said hurricane specialist Phillipe Pain, as quoted by the Associated Press.
Home improvement stocks tend to do well with hurricanes. That’s because they benefit from increased sales of plywood and other home improvement goods. This segment is “naturally positively exposed to preparation and recovery efforts,” says Morgan Stanley. These “typically see a boost in sales post-storm as damaged property is repaired.”
LOW is also technically oversold at double bottom support. It’s also over-extended on RSI, MACD, and Williams’ %R. From a current price of $185.40, we’d like to see the LOW stock again challenge prior resistance around $199 a share initially. Eventually, we’d like to see the LOW stock run back to $220 a share.
Sincerely,
Ian Cooper
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