Analysis of the Business Cycle

Topics: Lowe's, The Home Depot, Revenue Pages: 4 (1278 words) Published: May 12, 2011
Analysis of the Business Cycle
Tira Williams
Managerial Economics and Globalization


The Current Economic Condition:
The current economic conditions surrounding home improvement stores such as Home Depot and Lowes are closely tied to the recent housing crisis and recession. Wahlstrom (2010) indicated, macroeconomic trends such as single family housing turnovers and the residential housing market reached it inflection point and are moving towards equilibrium. This gradual turn around should have a positive impact on Home Depot and Lowes. The two companies were able to endure during the crisis; therefore they should begin recover from economic losses experiences during pendulum shift. The Firms Chosen:

Home Depot: Home Depot is a public traded company on NSDAQ. Not only is this company the largest home improvement retailer in the United States, it also has made it stake internationally in places like Canada, Mexico and China. Home Depot has laid the frame work for home improvement retail through product alliances and making professional products readily available to individuals wanted to embark upon do-it-yourself projects. Lowes: Lowes follows closely behind Home Depot. This home improvement company began as a simple hardware store in 1946, and is now publicly traded on the New York Stock exchange (NYSE:LOW). As the demand for housing increased, the need for professional quality supplies increased, developing a lasting relationship between Lowes and builders. It was not long before Lowes became a multi-million dollar company. Since its inception, the company has evolved, the new and improved Lowes caters to the areas in which they serve, for example the stores in metro areas are largest and the stores square footage decreases according to the market. Like Home Depot, Lowes has expanded outside of the United States borders, lending services to Canada and Mexico. Analysis

Stock Performance:
After closely reviewing the stock performances...
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