Homeowners plan to do more remodeling and spend more per project this year after delaying improvements, and that is good news for the top two U.S. home-improvement retailers Home Depot Inc. and Lowe’s Cos., an analyst said Monday. Two-fifths of homeowners plan to spend more on their homes than they did last year, compared with 33% of them who plan to spend about the same and 27% of them who said they’d spend less, according to an online survey by Piper Jaffray analyst Peter Keith, who queried 440 homeowners regarding their home remodeling goals. In another encouraging sign, 48% of the respondents said they planned to complete a discretionary project of greater than $500 this year. Three-quarters of them also indicated they have the cash savings to pay for a large ticket project. “We now expect home-improvement industry growth to outpace GDP growth for the foreseeable future,” Keith said. The analyst upgraded his ratings on both Home Depot (US:HD) and Lowe’s (US:LOW) to overweight on Monday, sending both stocks up about 1% to $51.58 and $32.01 respectively, as the rest of the retail sector declined. He has a $62 price target on Home Depot and $41 on Lowe’s.
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