RH, also known as Restoration Hardware, is set to announce its earnings report after the market closes on Thursday. With the stock reaching a record high of $744.56 in 2021 and currently trading around $277, investors are eager to see how the company performs. The stock is known for making significant moves following earnings announcements, either soaring if the numbers exceed expectations or plummeting if they fall short.
Analysts are predicting that RH will report a loss of ($0.08) per share on revenue of $724.67 million. The unofficial “Whisper number” suggests a slightly better outcome with a loss of ($0.01) per share. The company’s earnings have fluctuated in recent years, with steady growth up until 2023, a significant decline expected in 2024, and a slow rebound projected for 2025 and 2026.
Looking at the fundamentals, RH earned $19.90 per share in 2023 and $26.12 in 2022. However, forecasts indicate a sharp drop to $6.82 per share in 2024, followed by an increase to $8.75 per share in 2025 and $14.69 per share in 2026. The price to earnings ratio (P/E) stands at 44, which is 1.9 times the S&P 500 average. Additionally, the number of top-ranked funds holding the stock has risen from 502 to 574.
Technically, the stock is currently trading 32% below its 52-week high and slightly above its 200-day moving average. However, the 50-day moving average is below the 200-day moving average, which may not be a positive signal for investors. Ideally, bulls would prefer to see the 50-day moving average above the 200-day moving average with the stock trading above both levels. The reaction to the earnings report could dictate the stock’s future trajectory, potentially leading to a continued rally or a descent to new lows.
RH operates as a retailer in the home furnishings market, offering a wide range of products through various online channels and physical stores. Formerly known as Restoration Hardware Holdings, Inc., the company rebranded to RH in 2017 and is headquartered in Corte Madera, California.
As investors await the earnings report, it is crucial to observe how the market and RH stock respond to the news. Keeping losses minimal and adapting to market trends is essential during earnings season. The stock has been featured on FindLeadingStocks.com, a newsletter highlighting breakout stocks and market leaders, offering a trial to help investors identify and own the strongest stocks in the market.