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RH
(NYSE:RH)
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Rating:53Neutral
Price Target:
$159.00
▲(12.73% Upside)
Action:Reiterated
Date:06/26/26
RH’s score is constrained primarily by weak recent financial performance and high leverage (thin equity cushion), despite improved near-term cash generation. Technical indicators are modestly supportive, and the latest earnings call was a positive catalyst with raised FY26 guidance, but valuation remains relatively rich versus the recent earnings and revenue compression.
Positive Factors
Improving cash generation
Sustained positive operating and free cash flow on a trailing‑twelve‑month basis provides durable internal funding to support debt reduction, annual asset monetization targets, and reinvestment in galleries and RH Estates. Consistent cash generation underpins deleveraging and strategic execution over the medium term.
Negative Factors
Extremely high leverage and thin equity
A capital structure with very high leverage and a thin or recently negative equity base materially reduces financial flexibility. This raises refinancing, covenant and liquidity risk if operating cash flow slips, constraining the company's ability to invest or absorb shocks during a multi‑quarter recovery.
Read all positive and negative factors
Positive Factors
Negative Factors
Improving cash generation
Sustained positive operating and free cash flow on a trailing‑twelve‑month basis provides durable internal funding to support debt reduction, annual asset monetization targets, and reinvestment in galleries and RH Estates. Consistent cash generation underpins deleveraging and strategic execution over the medium term.
Read all positive factors
RH Key Performance Indicators (KPIs)
Any
Store Count
Indicates the total number of retail locations, providing insight into the company’s market presence and expansion strategy.
Indicates the total number of retail locations, providing insight into the company’s market presence and expansion strategy.
Data provided by:
The Fly
The FlyRH (RH) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$3.20B
Dividend YieldN/A
Average Volume (3M)952.47K
Price to Earnings (P/E)30.8
Beta (1Y)2.57
Revenue Growth4.84%
EPS Growth21.25%
CountryUS
Employees5,690
SectorConsumer Cyclical
Sector Strength84
IndustrySpecialty Retail
Share Statistics
EPS (TTM)5.49
Shares Outstanding18,900,969
10 Day Avg. Volume1,171,247
30 Day Avg. Volume952,466
Financial Highlights & Ratios
PEG Ratio0.43
Price to Book (P/B)61.53
Price to Sales (P/S)1.08
P/FCF Ratio14.77
Enterprise Value/Market Cap1.99
Enterprise Value/Revenue1.86
Enterprise Value/Gross Profit4.26
Enterprise Value/Ebitda12.23
Forecast
1Y Price Target
$169.10Price Target Upside19.90% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering12
EPS Forecast (FY)4.92
Revenue Forecast (FY)$3.63B
RH Business Overview & Revenue Model
Company Description
RH, along with its various associated businesses, functions as a prominent retailer specializing in home furnishings. Its extensive product portfolio spans categories such as furniture, lighting, textiles, bathware, decor, outdoor and garden essen...
How the Company Makes Money
RH primarily makes money by selling luxury home furnishings and related products directly to consumers. Its core revenue stream is product sales across major categories such as furniture, lighting, textiles, rugs, bath, décor, and outdoor furnishi...
RH Earnings Call Summary
Earnings Call Date:Jun 11, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Sep 03, 2026
Earnings Call Sentiment Neutral
The call mixed a clear operating beat and an upgraded FY26 outlook with an ambitious strategic push (RH Estates and major European galleries) and a concrete plan to convert backorders and drive H2 acceleration. However, material near-term margin headwinds from international preopening/start-up costs (hundreds of basis points), elevated backorders (~$75M), post‑COVID capital cost inflation, and macro weakness temper the optimism. Management emphasized long-term upside (IP, unique product assortment, trade program, and deleveraging actions) while acknowledging short-term execution and cost pressures.Positive Updates
Q1 Revenue and EBITDA Beat
Reported first quarter revenue of $800.3 million and adjusted EBITDA margin of 7.1%, both exceeding the high end of company expectations.
Negative Updates
Elevated Backorders and Tariff-Related Supply Issues
Backorder and special order balances were approximately $75 million higher year-over-year (about 4.5% of revenue), driven primarily by tariff-related resourcing and logistics; management confirmed forward guidance does not assume additional tariff refunds.
Read all updates
Q1-2026 Updates
Positive
Negative
Q1 Revenue and EBITDA Beat
Reported first quarter revenue of $800.3 million and adjusted EBITDA margin of 7.1%, both exceeding the high end of company expectations.
Read all positive updates
Company Guidance
RH reported Q1 FY26 revenue of $800.3 million and adjusted EBITDA margin of 7.1% (above the high end of expectations) and raised its FY26 outlook to revenue growth of +4.5%–8%, adjusted EBITDA margin of 14.2%–16% and adjusted free cash flow of $300–$400 million (the full‑year outlook includes an estimated -270 basis‑point EBITDA drag from international pre‑opening/start‑up costs). Q2 guidance is revenue growth of +0.5%–2.5% and adjusted EBITDA margin of 11.5%–13% (including an approximate -380 bps pre‑opening/start‑up impact). Management noted backorder/special‑order balances are roughly $75 million higher year over year, expects a 4.5‑percentage‑point H2 benefit from backlog reduction plus 2.5 ppts from new‑store growth and 5 ppts from RH Estates (supporting a move from roughly flat H1 to +12% in H2), guidance does not assume any further tariff refunds, and the company targets ~$200–$250 million of asset sales per year and a goal of being debt‑free by 2029.RH Financial Statement Overview
Summary
Income Statement
44
Neutral
Balance Sheet
18
Very Negative
Cash Flow
52
Neutral
| Breakdown | TTM | Jan 2026 | Jan 2025 | Jan 2024 | Jan 2023 | Jan 2022 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 3.43B | 3.44B | 3.18B | 3.03B | 3.59B | 3.76B |
| Gross Profit | 1.49B | 1.52B | 1.41B | 1.39B | 1.81B | 1.86B |
| EBITDA | 519.86M | 540.82M | 453.28M | 523.59M | 774.84M | 1.07B |
| Net Income | 103.05M | 124.79M | 72.41M | 127.56M | 528.64M | 688.55M |
Balance Sheet | ||||||
| Total Assets | 4.95B | 4.84B | 4.55B | 4.14B | 5.31B | 5.54B |
| Cash, Cash Equivalents and Short-Term Investments | 53.80M | 41.19M | 30.41M | 123.69M | 1.51B | 2.18B |
| Total Debt | 3.85B | 3.97B | 3.94B | 3.72B | 3.75B | 3.43B |
| Total Liabilities | 4.89B | 4.78B | 4.72B | 4.44B | 4.52B | 4.37B |
| Stockholders Equity | 56.93M | 60.60M | -163.59M | -297.39M | 784.66M | 1.17B |
Cash Flow | ||||||
| Free Cash Flow | 220.92M | 252.40M | -213.69M | -67.14M | 230.04M | 476.73M |
| Operating Cash Flow | 410.19M | 452.24M | 17.09M | 202.21M | 403.69M | 662.11M |
| Investing Cash Flow | -209.96M | -223.69M | -240.41M | -307.43M | -171.07M | -194.35M |
| Financing Cash Flow | -192.98M | -219.40M | 130.59M | -1.28B | -902.48M | 1.61B |
RH Technical Analysis
Positive
141.04
Price Trends
142.23
Positive
146.84
Positive
166.60
Positive
Market Momentum
6.21
Negative
65.16
Neutral
88.55
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RH, the sentiment is Positive. The current price of 141.04 is below the 20-day moving average (MA) of 153.08, below the 50-day MA of 142.23, and below the 200-day MA of 166.60, indicating a bullish trend. The MACD of 6.21 indicates Negative momentum. The RSI at 65.16 is Neutral, neither overbought nor oversold. The STOCH value of 88.55 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for RH.
RH Risk Analysis
RH disclosed 35 risk factors in its most recent earnings report. RH reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
RH Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
76 Outperform | $26.72B | 24.68 | 53.29% | 1.37% | 1.30% | 1.14% | |
67 Neutral | $7.30B | 26.63 | -25.47% | ― | 1.78% | 75.71% | |
65 Neutral | $2.97B | 8.25 | 18.01% | 1.04% | 3.77% | 4.71% | |
63 Neutral | $4.43B | 6.33 | -52.38% | 4.16% | -1.40% | -4.34% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
57 Neutral | $11.68B | ― | 10.98% | ― | 6.80% | 18.24% | |
53 Neutral | $3.20B | 30.80 | 515.43% | ― | 4.84% | 21.25% |
* Consumer Cyclical Sector Average
RH
RH
169.08
-29.30
-14.77%
BBWI
Bath & Body Works
21.96
-9.58
-30.38%
WSM
Williams-Sonoma
227.53
60.76
36.44%
W
Wayfair
94.50
39.47
71.72%
ETSY
Etsy
76.97
23.30
43.41%
ASO
Academy Sports and Outdoors
47.84
0.56
1.19%
RH Corporate Events
Executive/Board ChangesShareholder Meetings
RH Shareholders Approve Directors, Pay Plan, Auditor
Positive
Jun 25, 2026
At its annual meeting of shareholders held on June 18, 2026, RH investors elected three Class II directors—Hilary Krane, Katie Mitic, and Ali Rowghani—to serve three-year terms extending to the 2029 shareholders’ meeting. Shareho...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.