RH (NYSE:RH) Stock Falls 6.1% – What’s Next?

Shares of RH (NYSE:RH) dropped 6.1% during mid-day trading on Tuesday. The stock traded as low as $139.50 and last traded at $137.65. 45,909 shares changed hands during mid-day trading, a decline of 95% from the average session volume of 995,912 shares. The stock had previously closed at $146.52.

Key RH News

Here are the key news stories impacting RH this week:

• Positive Sentiment: RH benefited from a broader rotation into housing stocks, while heavy short interest may have accelerated buying as short sellers covered positions. Why RH Stock Jumped 20% in October
• Positive Sentiment: A reported price-target increase for RH’s depositary receipt provides an additional positive sentiment signal, although the target applies to an overseas-listed instrument and may have limited direct relevance to NYSE shares. RH Depositary Receipt Price Target Increased

Wall Street Analyst Weigh In

A number of brokerages have commented on RH. BNP Paribas Exane reaffirmed an “underperform” rating and set a $81.00 target price (down from $90.00) on shares of RH in a report on Friday, September 11th. Robert W. Baird cut their target price on shares of RH from $165.00 to $160.00 and set a “neutral” rating for the company in a research note on Friday, September 11th. The Goldman Sachs Group decreased their price objective on RH from $164.00 to $140.00 and set a “neutral” rating on the stock in a report on Tuesday, October 20th. Telsey Advisory Group increased their price target on shares of RH from $140.00 to $155.00 and gave the company a “market perform” rating in a report on Friday, September 11th. Finally, Wells Fargo & Company cut their price objective on shares of RH from $225.00 to $175.00 and set an “overweight” rating on the stock in a research report on Friday, September 11th. Seven analysts have rated the stock with a Buy rating, nine have assigned a Hold rating and three have assigned a Sell rating to the company’s stock. According to data from MarketBeat, RH presently has an average rating of “Hold” and a consensus price target of $163.79.

RH Price Performance

The firm’s 50-day moving average price is $130.95 and its two-hundred day moving average price is $153.79. The stock has a market cap of $2.59 billion, a PE ratio of 24.34, a PEG ratio of 2.80 and a beta of 1.91. The company has a current ratio of 1.12, a quick ratio of 0.37 and a debt-to-equity ratio of 26.57.

RH (NYSE:RH) last issued its quarterly earnings data on Thursday, September 10th. The company reported $2.70 earnings per share for the quarter, topping analysts’ consensus estimates of $0.38 by $2.32. RH had a return on equity of 132.79% and a net margin of 3.23%. The firm had revenue of $922.15 million during the quarter, compared to analysts’ expectations of $915.09 million. During the same period in the prior year, the business posted $2.93 EPS. The firm’s quarterly revenue was up 2.6% on a year-over-year basis. On average, equities analysts expect that RH will post 5.19 earnings per share for the current fiscal year.

Insider Buying and Selling at RH

In related news, Director Mark Demilio sold 1,000 shares of the business’s stock in a transaction on Tuesday, September 22nd. The stock was sold at an average price of $132.00, for a total transaction of $132,000.00. Following the transaction, the director directly owned 25,680 shares in the company, valued at $3,389,760. The trade was a 3.75% decrease in their position. The sale was disclosed in a filing with the Securities & Exchange Commission, which is available through this link. 26.90% of the stock is owned by insiders.

Institutional Investors Weigh In On RH

Hedge funds and other institutional investors have recently added to or reduced their stakes in the business. BlackRock Inc. grew its stake in shares of RH by 41.7% during the second quarter. BlackRock Inc. now owns 1,978,271 shares of the company’s stock worth $325,881,000 after acquiring an additional 581,710 shares during the last quarter. Bank of America Corp DE raised its position in shares of RH by 166.5% in the 1st quarter. Bank of America Corp DE now owns 238,681 shares of the company’s stock valued at $33,372,000 after purchasing an additional 149,127 shares during the last quarter. Renaissance Technologies LLC purchased a new position in shares of RH in the 1st quarter valued at approximately $13,954,000. Lodge Hill Capital LLC purchased a new position in shares of RH in the 1st quarter valued at approximately $13,283,000. Finally, Canada Pension Plan Investment Board acquired a new stake in RH in the 2nd quarter worth approximately $14,442,000. 90.17% of the stock is currently owned by hedge funds and other institutional investors.

RH Company Profile

RH, formerly known as Restoration Hardware, is a luxury home-furnishings company that curates and sells products for residential and hospitality interiors. Its offerings include furniture, lighting, textiles, rugs, bath and plumbing fixtures, outdoor furnishings, décor, and related design products.

The company markets its products through a multichannel platform that includes RH Galleries, smaller design galleries, outlet locations, catalogs, and its digital channels. RH also operates businesses such as Waterworks, which specializes in luxury kitchen and bath products, and provides interior-design services through its design professionals.