Restoration Hardware (RH) Stock Sinks As Market Gains: What You Should Know
Restoration Hardware (RH) closed at $672.41 in the latest trading session, marking a -0.89% move from the prior day. This move lagged the S&P 500's daily gain of 0.3%.
Coming into today, shares of the furniture and housewares company had lost 1.01% in the past month. In that same time, the Retail-Wholesale sector gained 2.41%, while the S&P 500 gained 4.28%.
Investors will be hoping for strength from RH as it approaches its next earnings release. The company is expected to report EPS of $6.70, up 8.06% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $985.98 million, up 16.71% from the prior-year quarter.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $25.90 per share and revenue of $3.76 billion. These totals would mark changes of +45.26% and +31.91%, respectively, from last year.
Investors might also notice recent changes to analyst estimates for RH. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. RH currently has a Zacks Rank of #1 (Strong Buy).
Valuation is also important, so investors should note that RH has a Forward P/E ratio of 26.2 right now. For comparison, its industry has an average Forward P/E of 15.73, which means RH is trading at a premium to the group.
Investors should also note that RH has a PEG ratio of 1.39 right now. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. Retail - Home Furnishings stocks are, on average, holding a PEG ratio of 1.39 based on yesterday's closing prices.
The Retail - Home Furnishings industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 44, which puts it in the top 18% of all 250+ industries.
The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
To follow RH in the coming trading sessions, be sure to utilize Zacks.com.
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