Lowe’s Companies, Inc. (NYSE:LOW) looked like a good buy — even before the double hurricane catalyst — because it was pretty cheap. Going forward, LOW stock is going to look even better.

Before late August 2017, the last major hurricane to make landfall in the United States was Wilma in 2005. That is a big 12-year drought in which no Category 3 or higher storm hit. But now it’s over.

Two major hurricanes have made landfall in the United States in the few weeks. Hurricane Harvey tragically hit Texas and Louisiana in late August. A few weeks later, Hurricane Irma devastated Florida, Georgia, and other states in the Southeast.

It is a very tragic and unusual situation with lots of damage. And unusual situations with lots of damage require massive rebuilding efforts.

LOW stock, along with peer Home Depot Inc (NYSE:HD) are up big since Hurricane Harvey made landfall on August 25. Both stocks are up almost 7% since then, versus ~2.6% gain for the S&P 500 Index.

I feel one of those stocks is very well positioned to continue to post robust gains over the next several months.

Which one? LOW stock. Here’s why:

Big Catalyst on a Depressed Valuation

LOW stock trades at 22-times trailing earnings, and that is right near a multi-year low in that multiple. The trailing EBITDA metric is sitting around 11-times. That is also right near a multi-year low. Same story with the trailing sales multiple, which is below 1-times.

No matter which way you look at it, Lowe’s stock is sitting a multi-year valuation low.

But Lowe’s is entering a very unusual period where demand for its products will be abnormally high. As communities in Texas, Florida, and Georgia look to rebuild both residential and commercial properties, home building materials demand will soar.

Where do you go when you need to build something? Sometimes Home Depot. Sometimes Lowe’s. HD will likely be the biggest winner (bigger market share), but LOW will still be the beneficiary of a huge spike in traffic simply because of its product offering.

And this isn’t some short-term catalyst. Hurricane rebuilding efforts usually last for several years. That means Lowe’s should be the recipient of more-robust building materials demand over the medium term.

How much will demand increase? It’s tough to say. Obviously, the preliminary damage estimates are quite large, so that does imply a pretty big sales tailwind to LOW. The communities hit are also densely populated regions.

There are certain factors at play here which imply that the demand increase will be quite large.

So that means Lowe’s is entering a period of what will likely be substantially bigger growth. But the stock is priced for smaller growth.

Therein lies an opportunity.

Bottom Line on LOW Stock

Hurricane plays (or any other natural disaster plays for that matter) seem a little distasteful. After all, what happened and continues to happen in Texas, Florida, Georgia, and elsewhere is extremely tragic. Lives were lost and communities were destroyed.

But as investors, we must acknowledge that certain stocks do tend to rise in these scenarios. When there is a lot of damage, a lot of rebuilding is required. Smart money is already on the move in response to these hurricanes, as shown in the LOW and HD gains since Harvey made landfall.

It’s not too late to chase the rally, especially in LOW stock. Despite the recent run-up, the stock remains in a multi-year valuation trough. But the double-hurricane catalyst means demand for Lowe’s goods will remain persistently high into the foreseeable future.

That is a pretty major disconnect between valuation and growth prospects.

And it means LOW stock is still a good buy here.

As of this writing, Luke Lango was long LOW and HD.