RH double downgraded to Underperform at BofA after tariff announcement

As previously reported, BofA downgraded RH (RH) to Underperform from Buy with a price target of $130, down from $410, following the imposition of “materially higher-than expected” global tariffs by the Trump administration. The firm sees significantly higher friction for inventory sourcing and risk to margins, high potential for industry-wide demand destruction and lower free cash flow and increased net leverage, the analyst tells investors. Even if tariffs could end up lower, the near-to-medium term impact likely makes FY25 revenue and EBITDA guidance “unachievable,” the analyst tells investors.