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Restoration Hardware (RH) Outpaces Stock Market Gains: What You Should Know

This post was originally published on this site

Restoration Hardware (RH) closed the most recent trading day at $716.75, moving +1.45% from the previous trading session.

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August 30, 2021 3 min read

This story originally appeared on Zacks

Restoration Hardware (RH) closed the most recent trading day at $716.75, moving +1.45% from the previous trading session. The stock outpaced the S&P 500’s daily gain of 0.43%.

Prior to today’s trading, shares of the furniture and housewares company had gained 6.39% over the past month. This has outpaced the Retail-Wholesale sector’s loss of 2.76% and the S&P 500’s gain of 2.56% in that time.

Wall Street will be looking for positivity from RH as it approaches its next earnings report date. On that day, RH is projected to report earnings of $6.54 per share, which would represent year-over-year growth of 33.47%. Our most recent consensus estimate is calling for quarterly revenue of $972.26 million, up 37% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $22.90 per share and revenue of $3.68 billion, which would represent changes of +28.44% and +29.23%, respectively, from the prior year.

Any recent changes to analyst estimates for RH should also be noted by investors. 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.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.08% higher. RH is currently sporting a Zacks Rank of #2 (Buy).

Looking at its valuation, RH is holding a Forward P/E ratio of 30.85. This represents a premium compared to its industry’s average Forward P/E of 16.09.

We can also see that RH currently has a PEG ratio of 1.76. 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 1.61 as of yesterday’s close.

The Retail – Home Furnishings industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 61, which puts it in the top 25% 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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