The rally put shareholders back ahead of the broader market so far in 2019, but behind chief rival Home Depot (NYSE:HD).
August's increase was powered by surprisingly strong operating trends in the most recent quarter. Lowe's revealed late in the month that sales gains were steady when compared with the prior quarter despite major new challenges such as deflation in the price of lumber. Lowe's even managed to edge past Home Depot on this core growth metric for the second straight quarter.
The consumer discretionary stock still has plenty of ground to make up between itself and Home Depot, especially in areas like profitability. Yet new CEO Marvin Ellison, who worked as an executive for Home Depot a few years ago, appears to have momentum on his side. The retailer predicted steady sales growth trends and modestly higher profitability for 2019 while Home Depot lowered its outlook slightly on both scores. Assuming the year plays out that way, Lowe's will have made an encouraging first step in its rebound plan.