According to Wahba, these acquisitions mark a shift in Home Depot’s strategy. In the first quarter of the current fiscal year, sales at U.S. stores open at least a year rose just 0.2%, highlighting the need for change.
“Home Depot is widely viewed as one of the most successful retailers of the last 20 years, one that has deftly leveraged a hot housing market that led to more people renovating their homes,” Wahba writes. The company now anticipates that future growth will not come solely from its 2,000 big-box stores serving DIY customers, but increasingly from large orders placed by professionals for more complex projects, such as roof repairs.
GMS, based in Georgia, operates a network of about 320 distribution centers offering wallboard, ceilings, steel framing, and other construction materials. It also runs roughly 100 tool sales, rental, and service centers for residential and commercial contractors—“all things Home Depot covets,” according to Wahba.
With disciplined dealmaking and a focus on long-term growth, many companies are positioning themselves to thrive.
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