Bank of America Securities analyst Robert Ohmes reiterated a Sell rating on RH today and set a price target of $170.00.
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Robert Ohmes has given his Sell rating due to a combination of factors affecting RH’s financial performance. The company’s third-quarter adjusted EBIT fell short of expectations, primarily due to increased tariff costs on back orders and special-order goods, alongside expenses related to the Paris opening. Additionally, RH’s adjusted EPS of $1.71 was below market expectations of $2.15, indicating a weaker financial position.
Furthermore, RH’s guidance for the fourth quarter reflects a slowdown in revenue growth and an increase in tariff pressures. The company’s decision to lower its full-year sales guidance and the forecasted decline in adjusted EPS for the upcoming years highlight ongoing challenges. These include international expansion costs and tariff headwinds, which are expected to continue impacting revenue and gross margins. The uncertainty surrounding demand durability, coupled with macroeconomic and tariff uncertainties, underpins the Sell rating.
Based on the recent corporate insider activity of 23 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of RH in relation to earlier this year.