RH (NYSE:RH) stock fell more than 6% on Friday after the luxury home furnishings retailer issued weaker-than-expected second-quarter revenue guidance, overshadowing first-quarter results that topped Wall Street estimates and a higher full-year sales outlook.
Earnings Top Expectations
RH reported a first-quarter loss of $1.97 per share, beating analysts’ estimates for a loss of $2.11 per share. Revenue rose to $800.3 million, ahead of the consensus estimate of $792.8 million.
RH projected second-quarter revenue of $903.6 million to $921.6 million, below the Wall Street consensus estimate of $937.8 million.
Despite the softer quarterly outlook, RH raised its fiscal 2026 revenue guidance. The company now expects full-year sales of $3.594 billion to $3.715 billion, up from its prior forecast of $3.577 billion to $3.715 billion. The updated range compares with the analyst estimate of $3.619 billion.
RH Analysts Raise Price Forecasts
Following the results, several analysts increased their price forecasts on the stock.
- Baird analyst Peter Benedict maintained a Neutral rating and raised his price forecast to $150 from $125.
- Wells Fargo analyst Zachary Fadem reiterated an Overweight rating and increased his price forecast to $175 from $160.
- Stifel analyst W. Andrew Carter maintained a Hold rating and lifted his price forecast to $130 from $110.
Guggenheim Sees Margin Expansion Ahead
Guggenheim analyst Steven Forbes reiterated a Buy rating on the stock with a $200 price forecast.
Forbes said RH’s first-quarter performance exceeded expectations and marked the first time since the second quarter of 2023 that results reached the high end of management’s guidance range. He also noted adjusted EBITDA came in about 30% above expectations.
The analyst said RH’s second-quarter guidance and implied second-half outlook support expectations for accelerating market share gains and improving profitability.
Forbes added that RH is nearing the end of a major product refresh cycle, including the upcoming RH Estates launch, while international expansion efforts, including the planned opening of RH London in Mayfair, could serve as important catalysts. As a result, he said the next 12 months “could reshape the consensus investment narrative” around the company.
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