Lowe’s CEO anticipates a surge in home renovations due to high mortgage rates, with stock increasing by nearly 6%. Homeowners have an average of $400,000 in equity per home, leading to potential renovation projects. The average 30-year fixed-rate mortgage is up to 6.24%, prompting homeowners to tap into home equity lines of credit for improvements. The US has an aging housing stock, now around 44 years old, driving demand for renovations.

Lowe’s is prepared for increased demand, posting strong third-quarter results and raising its full-year sales outlook. Despite lower same-store sales growth than forecasted, Wall Street remains optimistic compared to Home Depot’s bleak industry picture. Home Depot’s CEO cited stable demand, but anticipated growth did not materialize, leading to a margin gap with Lowe’s.

Lowe’s has seen double-digit growth in home installation services, including kitchens, bathrooms, HVAC systems, and more. CEO Ellison credits their success to a superior go-to-market strategy, outperforming competitors. Bank of America analysts predict Lowe’s profitability will improve, narrowing the margin gap with Home Depot as they gain traction with professional customers.

Read more at Yahoo Finance: Lowe’s stock pops, CEO says Americans will renovate homes instead of moving