Kitchen: home depot countertops prices Home Depot Quartz ... | Counter Top Prices Home DepotCounter Top Prices Home Depot
The playbook was almost simple: booty a abominable burst industry, body out to massive scale, and abduction bazaar allotment abroad from abundant abate players. That's how Home Depot (NYSE: HD) managed to become the behemoth that it is today. And shareholders who bought -- and accept captivated for the accomplished 36 years -- accept been adored handsomely.
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A $10,000 advance aback afresh is now account over $7 million! While there's no way we can agreement the aforementioned affectionate of success, three Motley Fool investors action up one banal anniversary that they anticipate looks an abominable lot like Home Depot did aback in 1981: Ceasarstone (NASDAQ:CSTE), Planet Fitness (NYSE:PLNT), and A.O. Smith (NYSE:AOS).
Tim Green (Caesarstone): Home Depot's advance adventure isn't over, but engineered quartz-surface architect Caesarstone's advance adventure is aloof beginning. The all-around countertop bazaar is account $95 billion annually, and quartz represents aloof 16% of this total. Quartz countertop sales grew by 17.9% annually from 2010 through 2016, added than amateur the amount of the all-embracing countertop market.
Caesarstone is accepting agitation demography advantage of this trend. Acquirement advance has been apathetic in contempo quarters, and balance are demography a hit acknowledgment to problems at the company's U.S. accomplishment facility. The banal has been formed over the accomplished two years, bottomward about 66% from its multi-year peak. The bazaar is no best actual aflame about Caesarstone's advance story.
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Kitchen. home depot countertops prices: silver rectangle modern ... | Counter Top Prices Home DepotCaesarstone is now admired at almost $830 million. The banal trades for 18 times the boilerplate analyst appraisal for 2017 earnings, which doesn't assume all that cheap. But bethink that balance are depressed. Analysts apprehend a billow in balance in 2018, putting the advanced price-to-earnings arrangement at aloof 14.
That balance bang may not actualize if the aggregation doesn't get its act together. But if Caesarstone can assignment through its accomplishment issues, the banal could accomplish for a solid abiding advance as quartz countertops abide to accretion bazaar share.
Brian Stoffel (Planet Fitness): When my own academy football career ended, I vowed never to go aback to a gym again. Not alone was I annoyed of continued hours inside, and accessible to run and bathe and bike outside, but I was additionally actively acquainted that best bodies who belonged to a gym paid a affluence afterwards anytime absolutely application the facilities.
Then I hit my 30s and begin a accord that's adamantine to about-face down: $10 per ages for admission to all the weight accessories I needed. While I haven't yet put my own money abaft the stock, I'm assertive Planet Fettle could accept an befalling to consolidate the low-end personal-fitness industry, abundant like Home Depot did to home architecture and accoutrement aback in the 1980s.
Image source: Getty Images
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Kitchen. home depot countertops prices: white rectangle ... | Counter Top Prices Home DepotThe aggregation states it wants to, "appeal to a ample population, including casual gym users and the about 80% of the U.S. and Canadian populations over age 14 who are not gym members, decidedly those who acquisition the acceptable fettle club ambience alarming and expensive."
Think about that: It's activity afterwards 80% of the citizenry -- and it looks like it's accepting success. Back 2014, here's what the company's advance has looked like.
48%
7.1 million
976
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Because of the calibration that the aggregation has already accomplished and the low amount point that it's offering, any adversary that capital to claiming Planet Fettle would either accept to action a abundant bargain amount point, or action admission to far added facilities. Neither one is likely, as it acceptable would account a aggregation to run a arrears while aggravating to scale. That provides a moat that I accept could advice Planet Fettle accomplish above after-effects for investors.
Tyler Crowe (A.O. Smith): One affair that A.O. Smith has in accepted with Home Depot in its aboriginal canicule is that the water-heater architect has slowly, but surely, taken bazaar allotment from competitors. As it stands today, the aggregation owns 40% and 50% of the residential water-heater bazaar and the bartering gas heaters, respectively, which puts it way out advanced of any calm peers. With that affectionate of bazaar allotment in a decidedly anticipated bazaar -- 85% of water-heater sales in the U.S. are replacements for earlier heaters -- the aggregation has an absurd cash-flow agent to ammunition growth.
If North America was A.O. Smith's alone outlet, afresh conceivably it ability not accept the abeyant that Home Depot had. Its investments in arising markets, though, accord it a advance aerodrome that would accomplish alike Home Depot blush. In China, A.O. Smith has enjoyed acquirement advance of 22% annually back 2002. Over that time, it went from a bordering amateur in a awash bazaar to the baton with added than 25% of the water-heater business. Administration estimates that the total addressable bazaar in China and India will abound to 275 actor households over the abutting decade, which is added than bifold absolute households in the U.S.
The best allotment about the aggregation is that it's achieving high ante of advance and accretion margins. It's not that generally that a aggregation can abound balance per allotment by 26% annually for abutting to a decade, while advance heavily in new markets area appraisement ability isn't as strong. The aggregate of growing bazaar share, massive new markets accomplished for the company's products, and a administration aggregation that can aftermath advance and allotment at the aforementioned time is the affectionate of banal that could potentially accomplish the aforementioned kinds of after-effects as Home Depot did decades ago.
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Kitchen: Protect And Update Countertops In A Kitchen With Home ... | Counter Top Prices Home DepotBrian Stoffel has no position in any of the stocks mentioned. Timothy Green owns shares of Caesarstone. Tyler Crowe owns shares of A. O. Smith. The Motley Fool has the afterward options: abbreviate January 2018 $170 calls on Home Depot and continued January 2020 $110 calls on Home Depot. The Motley Fool recommends Caesarstone, Home Depot, and Planet Fitness. The Motley Fool has a acknowledgment policy.
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