Home Depot (NYSE: HD) and Lowe's (NYSE: LOW) have long dominated the home improvement space in the U.S. In past decades, they drove massive growth and dividend returns for their investors as they expanded nationwide. Although Home Depot operates in Canada and Mexico, both have become slower-growth markets amid saturation in the U.S. market and limited international success.
Thus, the rapid growth days for both companies are likely over, which may reinforce the perception that they have become income stocks better suited for wealth preservation. 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 » Lowe's hiked its payout every year for several decades. The same is true for Home Depot, though it has raised its dividend for only 17 straight years, having paused increases between 2006 and 2010.
Still, each company has a long dividend history. Knowing that, investors may look for other ways to differentiate between the two retail stocks. As each company reports for the second quarter of 2026, investors might want to lean toward Lowe's, and here's why.
At first glance, income investors might favor Home Depot for its dividend. It offers an annual payout of $9.32 per share, taking the dividend yield to 2.7%. Lowe's $5.00 per share yearly dividend yields 2.2%.
However, its last payout increase hiked the dividend by more than 4.2%, significantly more than Home Depot's 1.2% increase. Moreover, investors may experience higher overall growth from Lowe's stock, as they have over the last five years. In recent years, Lowe's has worked to make its supply chain more efficient, improve store layouts, and tighten inventory management.
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