NYSE:RH

Stock Analysis Report

Executive Summary

RH, together with its subsidiaries, operates as a retailer in the home furnishings.

Snowflake

Fundamentals

Solid track record with moderate growth potential.


Similar Companies

Share Price & News

How has RH's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

4.9%

RH

5.3%

US Specialty Retail

3.4%

US Market


1 Year Return

43.7%

RH

1.6%

US Specialty Retail

5.4%

US Market

Return vs Industry: RH exceeded the US Specialty Retail industry which returned 1.6% over the past year.

Return vs Market: RH exceeded the US Market which returned 5.4% over the past year.


Shareholder returns

RHIndustryMarket
7 Day4.9%5.3%3.4%
30 Day7.8%0.7%-1.0%
90 Day44.6%1.9%-0.4%
1 Year43.7%43.7%3.3%1.6%7.7%5.4%
3 Year504.7%504.7%40.6%33.4%46.2%36.8%
5 Year142.5%142.5%57.4%43.6%65.6%47.5%

Price Volatility Vs. Market

How volatile is RH's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is RH undervalued compared to its fair value and its price relative to the market?

22.3%

Undervalued compared to fair value


Share Price vs. Fair Value

Undervalued: RH ($182.73) is trading below our estimate of fair value ($235.3)

Significantly Undervalued: RH is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: RH is poor value based on its PE Ratio (23x) compared to the Specialty Retail industry average (15.1x).

PE vs Market: RH is poor value based on its PE Ratio (23x) compared to the US market (17.7x).


Price to Earnings Growth Ratio

Low PEG Ratio: RH is poor value based on its PEG Ratio (1.5x)


Price to Book Ratio

PB vs Industry: RH has negative assets, so we can't compare its PB Ratio to the US Specialty Retail industry average.


Next Steps

Future Growth

How is RH forecast to perform in the next 1 to 3 years based on estimates from 19 analysts?

15.6%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: RH's forecast earnings growth (15.6% per year) is above the savings rate (2.7%).

Earnings vs Market: RH's earnings (15.6% per year) are forecast to grow faster than the US market (14.3% per year).

High Growth Earnings: RH's earnings are forecast to grow, but not significantly.

Revenue vs Market: RH's revenue (6.7% per year) is forecast to grow slower than the US market (7.3% per year).

High Growth Revenue: RH's revenue (6.7% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

High Future ROE: RH's Return on Equity is forecast to be very high in 3 years time (223.3%).


Next Steps

Past Performance

How has RH performed over the past 5 years?

9.7%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: RH's earnings have grown by 9.7% per year over the past 5 years.

Accelerating Growth: RH's earnings growth over the past year (60.1%) exceeds its 5-year average (9.7% per year).

Earnings vs Industry: RH earnings growth over the past year (60.1%) exceeded the Specialty Retail industry 8.3%.


Return on Equity

High ROE: RH's liabilities exceed its assets, so it is difficult to calculate its Return on Equity.


Return on Assets

ROA vs Industry: RH has a higher Return on Assets than the Specialty Retail industry average last year.


Return on Capital Employed

ROCE Improving: RH has significantly improved its Return on Capital Employed over the past 3 years.


Next Steps

Financial Health

How is RH's financial position?


Financial Position Analysis

Short Term Liabilities: RH has negative shareholder equity, which is a more serious situation than short term assets not covering short term liabilities.

Long Term Liabilities: RH has negative shareholder equity, which is a more serious situation than short term assets not covering long term liabilities.


Debt to Equity History and Analysis

Debt Level: RH has negative shareholder equity, which is a more serious situation than a high debt level.

Reducing Debt: RH's has negative shareholder equity, so we do not need to check if its debt has reduced over time.

Debt Coverage: RH's debt is well covered by operating cash flow (32.2%).

Interest Coverage: RH's interest payments on its debt are well covered by EBIT (3.9x coverage).


Balance Sheet

Inventory Level: RH has a high level of physical assets or inventory.

Debt Coverage by Assets: RH has negative shareholder equity (liabilities exceed assets) therefore debt is not covered by short term assets.


Next Steps

Dividend

What is RH's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

companyn/amarketbottom25%1.5%markettop25%3.8%industryaverage2.0%forecastin3Years0%

Current dividend yield vs market & industry


Stability and Growth of Payments

Notable Dividend: Unable to evaluate RH's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate RH's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.

Stable Dividend: Insufficient data to determine if RH's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if RH's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of RH's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

What is the CEO of RH's salary, the management and board of directors tenure and is there insider trading?

2.4yrs

Average management tenure


CEO

Gary Friedman (61yo)

5.8yrs

Tenure

US$3,943,757

Compensation

Mr. Gary G. Friedman has been the Chairman and Chief Executive Officer of Restoration Hardware Holdings, Inc. (now RH) since July 2, 2013 and January 31, 2014 respectively. Mr. Friedman is Founder of Hiera ...


CEO Compensation Analysis

Compensation vs. Market: Gary's total compensation ($USD3.94M) is about average for companies of similar size in the US market ($USD5.10M).

Compensation vs Earnings: Gary's compensation has been consistent with company performance over the past year.


Management Age and Tenure

2.4yrs

Average Tenure

55.5yo

Average Age

Experienced Management: RH's management team is considered experienced (2.4 years average tenure).


Board Age and Tenure

5.5yrs

Average Tenure

61yo

Average Age

Experienced Board: RH's board of directors are considered experienced (5.5 years average tenure).


Insider Trading

Insider Buying: RH insiders have only sold shares in the past 3 months.


Recent Insider Transactions

SellUS$1,180,40425 Sep 19
Kathleen Mitic
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares7,000
Max PriceUS$169.10
SellUS$837,87024 Sep 19
Eri Chaya
EntityIndividual
Role
Member of the Board of Directors
President
Shares5,000
Max PriceUS$167.57
SellUS$1,032,05319 Sep 19
David Stanchak
EntityIndividual
Role
Co-President
President and Chief Real Estate & Development Officer
Shares6,000
Max PriceUS$172.01
SellUS$1,327,00518 Sep 19
DeMonty Price
EntityIndividual
Role
Co-President
President and Chief Operating
Shares7,777
Max PriceUS$172.01

Ownership Breakdown


Management Team

  • Gary Friedman (61yo)

    Chairman & CEO

    • Tenure: 5.8yrs
    • Compensation: US$3.94m
  • Glenda Citragno (54yo)

    Chief Accounting Officer & Principal Accounting Officer

    • Tenure: 0.6yrs
  • David Stanchak (61yo)

    President and Chief Real Estate & Development Officer

    • Tenure: 1.9yrs
    • Compensation: US$2.84m
  • Peter Sallick

    CEO & Creative Director of Waterworks

    • Tenure: 0yrs
  • Eri Chaya (46yo)

    President

    • Tenure: 6.9yrs
    • Compensation: US$4.83m
  • Cammeron McLaughlin

    Senior Vice President of Investor Relations & Strategy

    • Tenure: 0yrs
  • DeMonty Price (57yo)

    President and Chief Operating

    • Tenure: 3.4yrs
    • Compensation: US$4.62m
  • Prakash Muppirala

    CTO & President of Digital Innovations

    • Tenure: 2.4yrs
  • Jack Preston (45yo)

    Chief Financial Officer

    • Tenure: 0.6yrs
  • Fernando Garcia

    President of Furniture Operations & Home Delivery

    • Tenure: 0yrs

Board Members

  • Keith Belling (61yo)

    Director

    • Tenure: 3.5yrs
    • Compensation: US$257.98k
  • Leonard Schlesinger (66yo)

    Independent Director

    • Tenure: 5.5yrs
    • Compensation: US$314.95k
  • Gary Friedman (61yo)

    Chairman & CEO

    • Tenure: 5.8yrs
    • Compensation: US$3.94m
  • Mark Demilio (63yo)

    Lead Independent Director

    • Tenure: 3.6yrs
    • Compensation: US$386.43k
  • Carlos Alberini (63yo)

    Independent Director

    • Tenure: 9.3yrs
    • Compensation: US$257.98k
  • Hilary Krane (55yo)

    Independent Director

    • Tenure: 3.3yrs
    • Compensation: US$280.48k
  • Katie Mitic (49yo)

    Independent Director

    • Tenure: 6yrs
    • Compensation: US$280.48k
  • Ali Rowghani (46yo)

    Independent Director

    • Tenure: 4.8yrs
    • Compensation: US$272.98k
  • Eri Chaya (46yo)

    President

    • Tenure: 6.9yrs
    • Compensation: US$4.83m

Company Information

RH's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: RH
  • Ticker: RH
  • Exchange: NYSE
  • Founded: 1979
  • Industry: Homefurnishing Retail
  • Sector: Retail
  • Market Cap: US$3.413b
  • Shares outstanding: 18.68m
  • Website: https://www.restorationhardware.com

Number of Employees


Location

  • RH
  • 15 Koch Road
  • Corte Madera
  • California
  • 94925
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
RHNYSE (New York Stock Exchange)YesNew Common StockUSUSDNov 2012
RS1DB (Deutsche Boerse AG)YesNew Common StockDEEURNov 2012
RH *BMV (Bolsa Mexicana de Valores)YesNew Common StockMXMXNNov 2012
0KTFLSE (London Stock Exchange)YesNew Common StockGBUSDNov 2012

Biography

RH, together with its subsidiaries, operates as a retailer in the home furnishings. It offers products in various categories, including furniture, lighting, textiles, bathware, décor, outdoor and garden, t ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/16 00:17
End of Day Share Price2019/10/15 00:00
Earnings2019/08/03
Annual Earnings2019/02/02


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.