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Traders: How to play the housing sector

Though stocks slid Thursday, "Fast Money" traders saw upside for names in one sector.

Shares of homebuilder and home improvement companies largely fell on the day with broader markets. But traders said some stocks in the sector are primed to rally.

Home Depot and Lowe's

Shares of home retail giants Home Depot and Lowe's both dipped about 1 percent on Thursday. But trader Tim Seymour believes they could rally, due to slower expansion and more traffic at stores.

Trader Guy Adami also said he likes Home Depot, based on momentum in selling its more expensive items.

An employee helps a customer shop for a sander at a Lowe's home improvement store in Chicago.
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An employee helps a customer shop for a sander at a Lowe's home improvement store in Chicago.

Sherwin Williams

Seymour added that building materials company Sherwin-Williams could have more upside than both Lowe's and Home Depot. The stock climbed about 0.7 percent on Thursday.

KB Home and PulteGroup

KB Home's stock rose on Thursday, while PulteGroup's fell. Trader Steve Grasso owns shares of both companies and believes they will climb.

He added that KB Home could potentially be an acquisition target for PulteGroup.

D.R. Horton

Trader Brian Kelly, on the other hand, was not sold on construction company D.R. Horton. He said he would take profits in its shares, which have climbed 7 percent in the last year.

Disclosures:

Tim Seymour

Tim Seymour is long AAPL, AVP, BAC, BBRY, DO, EDC, EWZ, F, FCX, GM, GOOGL, INTC, NKE, SINA, T, TWTR, VALE, VZ, XOM. Tim's firm is long BABA, BIDU, CLF, KO, MCD, MPEL, PEP, PF, SAVE, SBUX, VALE, WMT,YHOO, short HYG, IWM, WYNN

Steve Grasso

Steve is Long AAPL, BA, BAC, CC, DD, DIS, DECK, EVGN, KBH, MJNA, MU, OLN, PFE, PHM, T, TWTR, GDX firm is long WYNN kids own EFA, EFG, EWJ, IJR, SPY

Brian Kelly

Brian Kelly is long BBRY, Bitcoin, GLD, GLD puts, SH, SLV, TLT, US Dollar, UUP, Yen; he is short Aussie Dollar, BLK, British Pound, CS, DB, Euro, EWA, EWH, FRC, Hong Kong Dollar, UBS, SPY, Yuan, 5-Year Note Futures

Guy Adami

Guy Adami is long CELG, EXAS, GDX, INTC, Guy Adami's wife, Linda Snow, works at Merck.