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Richelieu Hardware (TSE:RCH)
TSX:RCH
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Richelieu Hardware
(TSX:RCH)
Rating:67Neutral
Price Target:
C$38.00
▲(5.67%Upside)
Richelieu Hardware (RCH) vs. iShares MSCI Canada ETF (EWC)
Market Cap
C$1.97B
Dividend Yield1.71%
Average Volume (3M)58.82K
Price to Earnings (P/E)23.7
Beta (1Y)0.76
Revenue Growth5.38%
EPS Growth-13.14%
CountryCA
Employees3,000
SectorConsumer Cyclical
Sector Strength64
IndustryFurnishings, Fixtures & Appliances
Share Statistics
EPS (TTM)0.41
Shares Outstanding55,305,504
10 Day Avg. Volume70,492
30 Day Avg. Volume58,820
Financial Highlights & Ratios
PEG Ratio-18.09
Price to Book (P/B)2.10
Price to Sales (P/S)0.00
P/FCF Ratio18.27
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
C$37.00Price Target Upside2.89% Upside
Rating ConsensusHold
Number of Analyst Covering2
Richelieu Hardware Business Overview & Revenue Model
Company DescriptionRichelieu Hardware (RCH) is a leading distributor, importer, and manufacturer of specialty hardware and related products in North America. The company serves a diverse range of sectors including kitchen and bathroom cabinet manufacturers, furniture manufacturers, and renovation and construction markets. Richelieu offers an extensive array of products such as decorative and functional hardware, kitchen accessories, lighting systems, and closet organizing solutions. The company is renowned for its innovative product lines and strong customer service.
How the Company Makes MoneyRichelieu Hardware makes money through a multi-faceted revenue model primarily based on the sale of hardware and related products. Its key revenue streams include direct sales to manufacturers, retailers, and home renovation professionals. The company benefits from a vast distribution network across North America, which allows it to efficiently supply its diverse product lines to a wide customer base. Richelieu's earnings are significantly enhanced by its strategic partnerships with manufacturers and its focus on product innovation and expansion into new markets. The company also invests in e-commerce platforms to cater to the growing online market, contributing further to its revenue.
Richelieu Hardware Earnings Call Summary
Earnings Call Date:Jul 10, 2025
(Q2-2025)
| % Change Since: -1.59%|
Next Earnings Date:Oct 02, 2025
Earnings Call Sentiment Neutral
Richelieu Hardware has shown strong sales growth, successful acquisitions, and a solid financial position, particularly in the U.S. market. However, challenges in net earnings, EBITDA margin, and the Canadian market, especially in Ontario, where sales have declined, present concerns. The lowlights, such as the decline in net earnings and challenges in the Canadian market, are significant and balance out the positive aspects, resulting in a mixed sentiment.Q2-2025 Updates
Positive Updates
Sales Growth
Total sales increased by 6.4% in the second quarter and 7.4% for the first half of the fiscal year, with U.S. sales growing by 11.7% in the second quarter.
Successful Acquisitions
Richelieu completed six acquisitions in the first six months, contributing an additional $53 million in sales. Notable acquisitions include Rhoads & O'Hara Architectural Products and Les industries Camcoat.
Investment in Facilities
The company invested in its network by adding over 50,000 square feet to its Detroit facility to expand product lines and capture growth opportunities.
Strong Financial Position
Richelieu maintains a robust financial position with a working capital of $614.2 million, a current ratio of 2.9:1, and almost no debt.
U.S. Market Performance
In U.S. dollars, sales to manufacturers rose by 9.9%, and total sales in the U.S. increased by 14.9% in Canadian dollars, accounting for 46.2% of total quarterly sales.
Negative Updates
Decline in Net Earnings
Second quarter net earnings attributable to shareholders decreased by 3.9%, and first half net earnings fell by 5.9%, mainly due to higher amortization expenses.
Decrease in EBITDA Margin
EBITDA margin dropped to 10.8% in the second quarter from 11.2% last year, primarily due to lower margins from recent acquisitions and integration costs.
Challenge in Canadian Market
Sales in Ontario declined due to challenging economic conditions, with concerns over unsold condominiums and potential market slowdown.
Canadian Retail Sales Decline
Sales to hardware retailers in Canada were down 73% in the second quarter, attributed to timing differences and a flat market overall.
Company Guidance
During the Richelieu Hardware Second Quarter Results Conference Call, the company reported a 6.4% increase in total sales for the second quarter of fiscal year 2025, with sales reaching $512.2 million. This growth was equally driven by internal growth and acquisitions. In the U.S., sales saw an 11.7% increase, primarily due to a 6.6% internal growth that incorporated minimal upward price adjustments due to new tariffs. Canadian sales remained stable at $276 million, despite challenges in Ontario's market. The company completed six acquisitions in the first half, contributing additional sales of $53 million, and expanded its Detroit facility by over 50,000 square feet. Second quarter EBITDA was up 2.7% to $55.2 million, although the EBITDA margin decreased slightly to 10.8% from 11.2% last year. Net earnings attributable to shareholders were $22.5 million, down 3.9% due to higher amortization expenses. Cash flow from operating activities before changes in noncash working capital was $46.8 million, reflecting a strategic focus on maintaining a robust financial position with a current ratio of 2.9:1 and minimal debt.Richelieu Hardware Financial Statement Overview
Summary
Richelieu Hardware shows stable revenue growth with a moderate profit margin and a strong capital structure. However, there are minor pressures on operational efficiency and free cash flow growth.Income Statement
Richelieu Hardware's TTM (Trailing-Twelve-Months) gross profit margin is 15.94%, with a net profit margin of 4.52%. The revenue growth rate from the previous annual report is 1.90%, indicating moderate growth. However, EBITDA margin decreased slightly to 10.89% from the previous period's 10.99%, reflecting some pressure on operational efficiency. Overall, the company shows stable revenue growth with reasonable profitability, albeit with slight margin contraction.72
Positive
Balance Sheet
Richelieu's debt-to-equity ratio is 0.35, showcasing a solid capital structure with relatively low leverage. The return on equity (ROE) stands at 8.93% for the TTM, indicating decent profitability relative to shareholder equity. The equity ratio is 63.82%, suggesting a strong equity position. Overall, the balance sheet reflects a well-capitalized company with low financial risk and good return on equity.75
Positive
Cash Flow
The TTM free cash flow is $108.61 million, with a modest growth rate of 5.45% compared to the previous period. The operating cash flow to net income ratio is 1.61, indicating strong cash generation relative to reported profits. However, the free cash flow to net income ratio is slightly lower at 1.29, suggesting some capital expenditure pressures. Overall, Richelieu demonstrates a healthy cash conversion cycle but faces minor challenges in maintaining free cash flow growth.68
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 1.87B | 1.83B | 1.79B | 1.80B | 1.44B | 1.13B |
| Gross Profit | 297.52M | 450.32M | 230.40M | 507.25M | 409.55M | 302.29M |
| EBITDA | 203.40M | 201.42M | 230.40M | 287.44M | 234.40M | 154.46M |
| Net Income | 84.38M | 85.75M | 111.47M | 168.39M | 141.76M | 85.22M |
Balance Sheet | ||||||
| Total Assets | 1.48B | 1.39B | 1.31B | 1.28B | 964.18M | 771.06M |
| Cash, Cash Equivalents and Short-Term Investments | 34.44M | 41.39M | 46.33M | 21.22M | 58.71M | 73.93M |
| Total Debt | 334.45M | 264.60M | 209.29M | 264.13M | 99.49M | 83.73M |
| Total Liabilities | 533.21M | 465.13M | 406.81M | 464.04M | 295.24M | 216.60M |
| Stockholders Equity | 944.51M | 926.51M | 904.89M | 817.16M | 666.44M | 551.09M |
Cash Flow | ||||||
| Free Cash Flow | 108.61M | 103.00M | 228.56M | -58.75M | 87.35M | 133.27M |
| Operating Cash Flow | 136.01M | 133.56M | 270.66M | -36.17M | 104.41M | 145.71M |
| Investing Cash Flow | -60.35M | -50.84M | -61.79M | -66.83M | -66.49M | -45.52M |
| Financing Cash Flow | -119.49M | -117.87M | -72.36M | -66.64M | -53.69M | -50.84M |
Richelieu Hardware Technical Analysis
Positive
35.96
Price Trends
35.12
Positive
34.21
Positive
36.28
Negative
Market Momentum
0.07
Positive
56.27
Neutral
65.11
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:RCH, the sentiment is Positive. The current price of 35.96 is above the 20-day moving average (MA) of 35.73, above the 50-day MA of 35.12, and below the 200-day MA of 36.28, indicating a neutral trend. The MACD of 0.07 indicates Positive momentum. The RSI at 56.27 is Neutral, neither overbought nor oversold. The STOCH value of 65.11 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:RCH.
Richelieu Hardware Peers Comparison
Overall Rating
UnderperformOutperform
Sector (62)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
79 Outperform | C$622.56M | 15.57 | 12.45% | 0.90% | 11.03% | 18.83% | |
78 Outperform | C$2.33B | 26.57 | 99.31% | 1.34% | 4.61% | 3.95% | |
73 Outperform | C$1.87B | 11.79 | 14.49% | 2.89% | 0.47% | 9.41% | |
67 Neutral | C$1.69B | 9.44 | 9.65% | 9.53% | -2.58% | 100.21% | |
67 Neutral | C$1.97B | 23.75 | 9.00% | 1.71% | 5.38% | -13.14% | |
62 Neutral | C$5.29B | 8.34 | 20.23% | 3.14% | 3.09% | 8.49% | |
59 Neutral | C$2.31B | ― | -0.03% | ― | 15.99% | 99.83% |
* Consumer Cyclical Sector Average
Performance Comparison
TSE:RCH
Richelieu Hardware
35.96
-3.72
-9.37%
TSE:TCL.A
Transcontinental
19.94
5.29
36.11%
TSE:PBL
Pollard Banknote
22.15
-4.66
-17.38%
TSE:LNF
Leon's Furniture
27.68
3.56
14.76%
TSE:NFI
NFI Group Inc
19.68
3.03
18.20%
TSE:PET
Pet Valu Holdings Ltd.
33.75
6.83
25.37%
Richelieu Hardware Corporate Events
M&A TransactionsBusiness Operations and StrategyFinancial Disclosures
Richelieu Hardware Reports Strong Q2 Sales and Strategic Acquisitions
Positive
Jul 10, 2025
Richelieu Hardware reported a 6.4% increase in sales for the second quarter of 2025, reaching $512.2 million, with significant contributions from both internal growth and acquisitions. The company completed two new acquisitions, adding to a total of six in the first half of the year, which are expected to enhance its North American distribution network and diversify its market segments. Despite challenging market conditions in Canada, Richelieu’s expansion efforts, including a significant expansion of its Detroit distribution center, underscore its commitment to strengthening its market position and supporting growth.
The most recent analyst rating on (TSE:RCH) stock is a Hold with a C$43.00 price target. To see the full list of analyst forecasts on Richelieu Hardware stock, see the TSE:RCH Stock Forecast page.
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.