Home Depot vs. Lowe's Q4: Same Storm. Opposite Outcomes.
January Belonged to Lowe's. Q1 Belongs to Home Depot. Here's Why.
The market delivered a strange verdict this week.
Lowe’s crushed Q4 performance—posting a +1.3% comp versus Home Depot’s +0.3%, capturing over $100 million in storm-driven sales, and demonstrating strong underlying execution.
The stock dropped 4%.
Home Depot posted modest results, characterized weather as neutral, and beat on execution without fanfare. The stock rallied 3% and held its gains.
What gives?
The answer lies in a simple truth: investors don’t pay for what you did yesterday. They pay for what you’ll do tomorrow.
And when it comes to Q1, the market chose Home Depot.
The Weather Story: Same Quarter, Different Months
Both retailers experienced identical Q4 weather—warm November, volatile December, stormy January. But their monthly performance diverged dramatically.
Here’s how it played out …
November: Warmth Helped Lowe’s
Lowe’s EVP Merchandising Bill Boltz noted that “customers took advantage of milder weather earlier in the quarter to work on outdoor projects.” Paint sales were strong. Outdoor categories performed. The DIY customer showed up.
Result: Lowe’s +0.4%, Home Depot -0.3%
Home Depot’s Pro-heavy business mix doesn’t swing as much on mild weather—Pros work regardless of temperature. Lowe’s DIY/outdoor focus captured the upside.
December: Volatility Hurt Both
December delivered neither sustained warmth nor consistent cold—just noise. Holiday shopping happened, but weather didn’t help or hurt in any meaningful way.
Result: Lowe’s -1.0%, Home Depot -0.2%
January: Winter Storms = Lowe’s Surge
This is where geography determined everything.
Two storms hit in late January:
Winter Storm Fern (late January): East Coast corridor
Winter Storm Gianna (January 30): Southeast, specifically the Carolinas
Lowe’s CFO Brandon Sink quantified the impact precisely:
“Winter Storms Fern and Gianna positively impacted Q4 comp sales by approximately 50 basis points.”
Translation:
50 basis points = 0.5% of $20.6B in Q4 sales
Storm benefit: ~$103 million for the quarter
For January alone, the percentage impact looked even larger — because the storms hit late in the quarter, nearly all of that $103M was concentrated in a single month:
Storm benefit: 200 basis points (2.0%) of January sales
January sales: ~$7.9 billion (5-week fiscal month)
Storm benefit: ~$103 million — the same dollars, expressed as a bigger percentage of a smaller base
Result: Lowe’s +5.8%, Home Depot +1.4%
That’s not a typo. Lowe’s January comp was four times larger than Home Depot’s — driven by $103 million in storm demand concentrated in the final weeks of the quarter.
Why Did Lowe’s Capture More Storm Benefit?
Geography!
Winter Storm Gianna hit the Carolinas—Lowe’s sweet spot:
Lowe’s is massively overweight in the Southeast compared to Home Depot. When Gianna hit the Carolinas on January 30—the last day of Lowe’s fiscal quarter—Lowe’s captured the pre-storm surge across 26% of its store base.
Home Depot has broader national distribution. That’s usually an advantage. But in Q4, it meant their storm benefit was diluted by stores in neutral markets like the West (19% of HD’s footprint vs. 13% for Lowe’s).
Lowe’s concentration created leverage. Home Depot’s diversification created drag.
The Quarterly Result: Weather Was Neutral
Here’s what’s remarkable: despite all the monthly volatility, the weather was neutral on a consolidated quarterly basis for both retailers.
Lowe’s underlying performance (excluding storms):
Reported comp: +1.3%
Storm benefit: -0.5%
Underlying comp: +0.8%
Home Depot’s characterization:
“Adjusting for storms, underlying demand was relatively stable throughout the year.”
Our G2 Weather Signal for both: 50/100 (Neutral, Grade C)
This is exactly what a neutral signal predicts—weather creates weekly and monthly noise, but the quarterly consolidated impact averages out. Execution quality shows through clearly because there’s no weather tailwind to hide behind.
Lowe’s simply executed better within that neutral environment:
✅ Captured November warmth (+0.4% vs. HD -0.3%)
✅ Positioned for January storms (+5.8% vs. HD +1.4%)
✅ Delivered +0.8% underlying growth ex-weather
So Why Is Lowe’s Stock Down 4%?
Because the market doesn’t care about Q4 anymore. It cares about Q1. And this is where the story flips.
The Hernando Problem
On February 22-23, Winter Storm Hernando slammed the Northeast. Boston, New York, Philadelphia, Pittsburgh—all buried under snow and ice.
Here’s how the two retailers characterized it:
Home Depot (Tuesday, Feb 24):
CEO Ted Decker: “Bullish for Q1 on the back of the winter storm earlier this week.“
Lowe’s (Wednesday, Feb 25):
CFO Brandon Sink: “Given severe winter storm activity in February, we are now expecting Q1 comp sales to be below the midpoint of our full-year guide.“
Same storm. Opposite takes.
What happened? Geography flipped.
Hernando hit the Northeast:
Home Depot: 10.6% Northeast stores + “Northern division” strength
Lowe’s: 9.8% Northeast, 26.4% Southeast (not affected)
For Home Depot: Hernando = tailwind (captured pre-storm surge in Northern division, emergency prep demand)
For Lowe’s: Hernando = headwind (missed the surge, Southeast concentration offered no benefit, storm disrupted traffic)
The same geographic advantage that helped Lowe’s in Q4 (Southeast overweight) became a disadvantage in Q1 (Hernando missed them entirely).
The FY26 Guidance Miss
Lowe’s also guided below consensus for full-year 2026:
Lowe’s guidance: $12.25-$12.75 adjusted EPS (midpoint $12.50)
Analyst consensus: $12.95
Miss: -$0.45 per share (-3.5%)
The market heard: “We crushed Q4, but we’re being cautious on the year because of Hernando disruption, margin pressure, and macro uncertainty.”
Home Depot guided conservatively too, but didn’t miss consensus and characterized near-term weather (Hernando) as a tailwind, not a headwind.
Investors chose the “bullish for Q1” story over the “below midpoint” story.
The Bottom Line
Q4 belonged to Lowe’s:
Beat Home Depot on comps (+1.3% vs. +0.3%)
Captured $103M in storm benefit through superior positioning
Demonstrated +0.8% underlying execution strength
But Q1 belongs to Home Depot:
Hernando hit their Northern footprint (not Lowe’s Southeast)
“Bullish for Q1” vs. “below midpoint”
Stock up +3% vs. Lowe’s down -4%
The lesson: Geographic advantages are temporary. Weather doesn’t care about your strategy—it goes where it goes. Q4 storms favored Lowe’s Southeast concentration. Q1 storms favor Home Depot’s Northern presence.
The race shifts based on where the weather hits.
And that’s exactly what the G2 Weather Signal framework predicted: Weather was neutral for the quarter (50/100, Grade C). No sustained tailwind, no sustained headwind. Just weekly volatility that averaged out.
Execution determined the winner within that neutral environment—and Lowe’s executed better in Q4.
But investors pay for tomorrow, not yesterday. And tomorrow looks better for Home Depot.
What’s Next?
Next week, we’ll publish the Q1 outlook for both retailers, available exclusively to premium subscribers:
March weather patterns and Easter timing (April 5)
Which retailer is better positioned for spring acceleration?
Hernando’s full impact quantification
Geographic advantages for Q1 storms vs. spring warmth
Detailed Q1 weather signals and comp forecasts
— Paul
Musical Coda
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