Oppenheimer downgrades Lowe's and Home Depot, says 'post-pandemic reset' coming for home improvement

A customer wears a protective mask while unloading purchases off a cart outside a Home Depot Inc. store in Reston, Virginia, on Thursday, May 21, 2020.
Andew Harrer | Bloomberg | Getty Images

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Oppenheimer downgraded two red-hot retail stocks on Friday, saying a recent surge in sales is due for a correction.

The firm lowered its price target for Home Depot and Lowe's, changing their ratings to perform from outperform. The stocks have risen sharply since March as the housing sector bounced back and the shift to working from home led to more home improvement projects. Now, they are facing a "post-pandemic reset," Oppenheimer said in  note to clients.