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RH (RH) Dips More Than Broader Market: What You Should Know

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The latest trading session saw RH (RH - Free Report) ending at $325.69, denoting a -0.54% adjustment from its last day's close. The stock's change was less than the S&P 500's daily loss of 0.03%. On the other hand, the Dow registered a loss of 0.61%, and the technology-centric Nasdaq increased by 0.56%.

The furniture and housewares company's stock has dropped by 3.6% in the past month, falling short of the Consumer Staples sector's loss of 2.17% and the S&P 500's gain of 1.39%.

The investment community will be closely monitoring the performance of RH in its forthcoming earnings report. The company is expected to report EPS of $2.67, up 735.71% from the prior-year quarter. Simultaneously, our latest consensus estimate expects the revenue to be $811.23 million, showing a 7.99% escalation compared to the year-ago quarter.

For the full year, the Zacks Consensus Estimates project earnings of $5.61 per share and a revenue of $3.15 billion, demonstrating changes of -18.34% and +4.15%, respectively, from the preceding year.

Furthermore, it would be beneficial for investors to monitor any recent shifts in analyst projections for RH. Recent revisions tend to reflect the latest near-term business trends. Therefore, positive revisions in estimates convey analysts' confidence in the company's business performance and profit potential.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.

The Zacks Rank system, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. RH is currently sporting a Zacks Rank of #4 (Sell).

In terms of valuation, RH is currently trading at a Forward P/E ratio of 58.37. This signifies a premium in comparison to the average Forward P/E of 19.27 for its industry.

Meanwhile, RH's PEG ratio is currently 1.87. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. By the end of yesterday's trading, the Consumer Products - Staples industry had an average PEG ratio of 1.87.

The Consumer Products - Staples industry is part of the Consumer Staples sector. This group has a Zacks Industry Rank of 148, putting it in the bottom 42% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.


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