Lumber prices have been on a wild ride since the pandemic onset. The price, measured per thousand board feet, was around $400 in December 2019, before the outbreak. It fell to $236 in April 2020 before skyrocketing over the next year, reaching almost $1,700 in May this year. The price started crashing as economies were reopening, falling to nearly $400 in August. Now, it's surging again, trading at $755 as of this writing.
Home improvement retail giants Home Depot (NYSE: HD) and Lowe's (NYSE: LOW) sell a lot of lumber to professionals and do-it-yourselfers. Therefore, changes in lumber prices can have a significant impact on their business. Let's look at Home Depot and Lowe's and see if the recent lumber prices increase is good or bad news.
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Are Surging Lumber Prices Good or Bad News for Home Depot and Lowes?