For years, Home Depot Inc. (HD ) has been a Goliath of retailing, driving dozens of rival hardware chains out of business. But Home Depot may finally have met its David in the person of Robert L. Tillman, 59, head of fast-growing Lowe's Cos. In his six years as CEO, Tillman has transformed the $22 billion Wilkesboro (N.C.)-based chain. Lowe's (LOW ) shares have climbed more than 80% over the past two years, while Home Depot's are down 40%.
Analysts credit Tillman, a college dropout who joined Lowe's in 1963 and rose up as a store manager. His blueprint for success? While Home Depot has focused on pros and male customers, Tillman seized on research showing that women initiate 80% of home projects. He redesigned Lowe's stores to give them a brighter appearance, began stocking more appliances, and has focused on higher-margin goods--everything from Laura Ashley paints to high-end bathroom fixtures.
And like another rural retailer, Wal-Mart Stores Inc. (WMT ), Lowe's has one of the industry's best inventory systems. As a result, profits are on track to rise 37% in the fiscal year ending in January, vs. 21% for Home Depot. That's some slingshot.
-- Lowe's stock is up 83% in two years, compared with a 41% decline for rival Home Depot
-- In head-to-head competition, Lowe's is stealing market share from Home Depot