In the latest trading session, Restoration Hardware (RH) closed at $146.07, marking a -1.16% move from the previous day. This move lagged the S&P 500's daily gain of 4.94%. Elsewhere, the Dow gained 4.89%, while the tech-heavy Nasdaq added 4.95%.
Heading into today, shares of the furniture and housewares company had lost 35.13% over the past month, lagging the Retail-Wholesale sector's loss of 11.32% and the S&P 500's loss of 17.66% in that time.
RH will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $3.58, up 19.33% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $709.42 million, up 5.6% from the year-ago period.
It is also important to note the recent changes to analyst estimates for RH. Recent revisions tend to reflect the latest near-term business trends. 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. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection has moved 0.23% lower. RH is currently a Zacks Rank #3 (Hold).
Digging into valuation, RH currently has a Forward P/E ratio of 10.81. For comparison, its industry has an average Forward P/E of 10.86, which means RH is trading at a discount to the group.
Investors should also note that RH has a PEG ratio of 0.61 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. RH's industry had an average PEG ratio of 0.58 as of yesterday's close.
The Retail - Home Furnishings industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 176, putting it in the bottom 31% 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.
You can find more information on all of these metrics, and much more, on Zacks.com.
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