Come springtime and local home centers and hardware stores are packed with consumers looking to buy mulch, plants, gardening tools and more. After all, people are tired of being stuck inside during the cold winter months and want to spend some time and money outdoors. As an investor, how can you profit from this? The answer is investing in SiteOne Landscape Supply.

I bet you never heard of this company before. There is a good reason for this. As of this writing, they only control 10% of the $17 billion dollar landscaping market. And never having heard of them is a great reason to learn more about them and how they are leading the way to dominate this market.

Who is SiteOne Landscape Supply?

As mentioned, SiteOne (NYSE: SITE) is a landscape company that operates in the United States and Canada. They currently have 477 stores in 44 states and 5 Canadian provinces, plus 3 distribution centers in the US as well.

What makes this company unique is the industry they are in. Most landscaping companies are small, Mom and Pop businesses, making the industry very fragmented. SiteOne has been buying these small, independent businesses and creating a national network of landscape supply stores.

Here is why this is important. By having a national network, they are able to offer many more products than most independent businesses can. They also can out price them too since SiteOne can move a lot more product.

And speaking of products, SiteOne offers everything a landscaper needs, from fertilizer to mulch, plants, pavers and stones. In fact, they have over 120,000 products for sale. Many Mom and Pop shops simply cannot compete.

Who are the customers of SiteOne? While they do sell to individuals, a lot of their revenue comes from large building complexes, landscaping companies, and golf courses.

Why SiteOne Is An Investors Dream

As I mentioned, SiteOne controls just 10% of this $17 billion dollar industry. And it continues to buy more businesses and add stores throughout the country. This means they will easily grow their revenues.

As for revenues, they have been up 63% since 2013 and up 11% in the last earnings call. Analysts expect profits for SiteOne to grow at more than 28% annually for the next 5 years.

But I know what you are thinking, online sellers including Amazon are going to destroy this industry. This is far from the case. Here is why. It isn’t easy or more importantly, cost-effective to ship large quantities of mulch, fertilizer or landscaping stones. It is even tough to ship small quantities. So in effect, this industry is Amazon proof.

The only downside to this company could be their stock price in terms of earnings per share. It is no doubt pricey at first glance. But you have to remember that this company is growing fast and as a result, is going to have a higher than average price to earnings ratio.

Final Thoughts

SiteOne is a name you most likely never heard of until today. But they are making headlines with how they are strategically acquiring smaller shops in this fragmented industry and creating a dominant player.

And this is exactly who you want to invest in. A company that is a leader and will be able to squash any potential competitors. I would be buying this stock at any pull back and even consider buying shares before a pullback happens.