Key Takeaways RH plans to cut China sourcing from 16% to 2% in FY25 and boost U.S. and Italy output to reduce tariff risks. Adjusted EBITDA margin rose 80 bps in Q1 FY25; full-year guidance held at 20-21% despite macro headwinds. RH stock trades at 0.95x forward P/S, below ETD and above ARHS, with FY25 EPS still set to nearly double.The ambiguity surrounding the United States’ new tariff regime is currently known to be haunting the global market, and RH (RH) is not an exception to it, given its line of bu ...

Core Insights - RH, formerly known as Restoration Hardware, is focusing on in-house initiatives to improve revenue visibility and profitability in a challenging macroeconomic environment, including global expansion and supply-chain optimization [1] Group 1: Strategic Initiatives - The company is targeting untapped markets by opening new design galleries to increase market share and brand visibility, with plans to open six galleries in 2025 [2] - Internationally, RH has seen a 60% demand increase in Munich and Dusseldorf, indicating strong growth potential in Europe, with further openings planned in Paris, London, and Milan [3][7] Group 2: Financial Performance - RH's stock has increased by 23.4% over the past three months, outperforming the Hoya Capital Housing ETF [5] - The stock is currently trading at a forward P/E ratio of 16.34, which is lower than competitors Williams-Sonoma and Ethan Allen, suggesting a promising valuation for investors [9] Group 3: Earnings Estimates - Earnings estimates for fiscal 2025 have risen to $10.76 per share, reflecting a year-over-year growth of 99.6%, while estimates for fiscal 2026 have decreased to $14.61, showing a 35.8% growth [10][11]

Industry Overview - The United States' home-furnishing market is experiencing a setback due to reduced consumer confidence, high mortgage rates, lingering inflation risks, and concerns regarding new tariff implementations [1] - Despite these challenges, companies like RH and Williams-Sonoma are managing to sustain business growth through diversified strategies [1] Company Profiles RH - RH is a leading luxury retailer in home furnishings with a market cap of approximately $3.88 billion, offering a wide range of products including furniture, lighting, textiles, and décor [2][4] - The company is benefiting from global expansion, with significant demand growth of 60% in RH Munich and RH Dusseldorf during Q1 of fiscal 2025 [4] - RH plans to open seven Design galleries in 2025 and aims for long-term expansion of 7-9 new galleries annually [5] - To mitigate tariff-related uncertainties, RH is shifting sourcing out of China, projecting a reduction from 16% to 2% by Q4 of fiscal 2025 [6] Williams-Sonoma - Williams-Sonoma, with a market cap of about $21.3 billion, is a multi-channel specialty retailer of premium home products and is one of the largest e-commerce retailers in the U.S. [2][7] - The company reported a 6.2% increase in retail and a 2.1% increase in e-commerce comparable sales year-over-year in Q1 of fiscal 2025 [7] - Williams-Sonoma is investing between $250 million and $275 million in fiscal 2025, with 85% dedicated to enhancing e-commerce and supply-chain efficiency [7] - The B2B segment of Williams-Sonoma grew by 8% year-over-year in Q1 of fiscal 2025, indicating successful market capture [9] Financial Performance - RH is projected to achieve 99.6% EPS growth in fiscal 2025, while Williams-Sonoma's EPS is expected to decline by 3% [8] - RH's stock is trading at a discount compared to Williams-Sonoma, suggesting stronger growth potential amid uncertain housing demand [8][13] - The Zacks Consensus Estimate for RH's fiscal 2025 earnings is $10.76 per share, indicating significant growth potential [16] - In contrast, Williams-Sonoma's fiscal 2025 earnings estimate remains at $8.53 per share, reflecting a decline [18] Strategic Initiatives - RH's global expansion efforts and product platform enhancements are driving positive demand trends, particularly in Europe [4][5] - Williams-Sonoma's strategic initiatives are yielding positive results in key markets, including Canada, Mexico, and India, with plans for further expansion [10] - Both companies are navigating macroeconomic pressures, with Williams-Sonoma facing challenges from new tariff regulations and ongoing inflation [11] Investment Outlook - RH stock is viewed as a high-growth option at a discounted valuation, making it attractive for investors seeking growth amid market risks [19] - Williams-Sonoma, while showing long-term growth potential, faces challenges due to market uncertainties and a current premium valuation [19][20] - Both stocks currently carry a Zacks Rank 3 (Hold), but RH is perceived to offer better upside potential for growth-oriented investors [20]

Core Insights - RH is implementing diverse in-house strategies to ensure margin expansion amid high mortgage rates, tariff-related risks, and inflationary pressures [1] - The company is focusing on global expansion, a customer-friendly membership approach, and supply-chain optimization to increase revenue visibility [1] Group 1: Financial Performance - In Q1 2025, RH's adjusted EBITDA margin expanded by 80 basis points year-over-year to 13.1% [1][8] - The company expects its adjusted EBITDA margin for FY25 to be between 20% and 21%, up from 16.9% reported last year [4][8] - Earnings estimates for fiscal 2025 have trended upward to $10.87 per share, indicating robust 101.7% year-over-year growth [11] Group 2: Market Expansion - Demand in Europe has grown by 60% across RH Munich and RH Dusseldorf, with continued growth in RH Brussels and RH Madrid [2] - RH plans to open new locations in Paris in September 2025, and two more in London and Milan in 2026 [2] Group 3: Supply Chain Strategy - RH is shifting its sourcing out of China, expecting receipts to reduce from 16% in Q1 2025 to 2% by Q4 2025 [3][8] - By the end of 2025, RH projects that 52% of its upholstered furniture will be produced in the U.S. and 21% in Italy [3] Group 4: Competitive Positioning - RH shares have gained 13.9% in the past month, outperforming the Hoya Capital Housing ETF (HOMZ) [5] - In comparison, shares of competitors Williams-Sonoma and Arhaus have increased by 3.8% and 2.2%, respectively [6] Group 5: Valuation Metrics - RH stock is currently trading at a forward 12-month P/E ratio of 15.3X, which is lower than Williams-Sonoma's 18.83X and Arhaus's 19.66X [9] - The discounted valuation of RH stock compared to other market players presents a promising opportunity for investors [9]

Alibaba - Alibaba is a leading e-commerce and cloud service company facing competition and regulatory challenges in China, but it has strong demand in its cloud business [3][5] - The average analyst's 12-month price target for Alibaba is $162, indicating a 39% upside from the current share price, with a forward price-to-earnings multiple of 11.7 [4][7] - Alibaba's cloud revenue grew 18% year over year, and the company is leveraging AI for personalized user experiences and supply chain management [5][6] - Analysts project Alibaba's earnings to grow at an annualized rate of 16% over the next several years, suggesting potential for the stock to double in value within three to five years [7] Lyft - Lyft's stock has decreased nearly 80% since its 2019 IPO, but the company is now showing solid growth and profitability [8][9] - A Wall Street analyst has set a 12-month price target of $28 for Lyft, indicating an 80% upside potential [9] - In Q1, Lyft's revenue rose 14% to $1.5 billion, and adjusted EBITDA nearly doubled from $59.4 million to $106.5 million [10] - Lyft has introduced new features and made strategic acquisitions, including the purchase of Freenow to expand into Europe [11][12] - The stock is considered cheap with a price-to-sales ratio of around 1.1, and the company is expected to continue double-digit growth [12] RH - RH, a luxury furniture retailer, is recovering from macroeconomic pressures and is expected to see stock price increases [13][14] - The company operates around 100 galleries and is expanding into Europe, with strong performance in its U.K. gallery, where sales increased by 47% [16] - RH has reported year-over-year revenue increases for the past four quarters, with a 12% sales increase in the latest fiscal first quarter [17] - The average target price for RH is 24% higher than its current price, with one analyst predicting a 137% increase over the next 12 to 18 months [17][18] - RH is trading at a valuation of 13 times forward 1-year earnings, making it an attractive option for risk-tolerant investors [18]

Core Viewpoint - RH, formerly known as Restoration Hardware, is experiencing a decline in share price due to softness in the U.S. housing market, which directly impacts its luxury home furnishing business [1][2][18]. Group 1: Current Performance - RH's share price has dropped 23.2% over the past three months, significantly underperforming the Hoya Capital Housing ETF (HOMZ), which declined by 4.9% [1]. - Compared to competitors like Williams-Sonoma, Ethan Allen, and Arhaus, RH has also lagged, with their share prices falling by 3.4%, 1.7%, and 9.2% respectively during the same period [3]. Group 2: Market Challenges - The ongoing softness in the U.S. housing market is weakening demand for renovations and luxury home furnishings, which is critical for RH's business [2][18]. - Tariff uncertainties and rising expenses due to brand expansion strategies are adding to the company's challenges [2]. Group 3: Growth Prospects - Despite current challenges, RH's long-term prospects are bolstered by strategic investments in its brand portfolio and global expansion efforts [4]. - The company has seen a 60% increase in demand in its European markets, particularly in Munich and Dusseldorf, indicating strong international appeal [5][8]. Group 4: Strategic Initiatives - RH is shifting its sourcing strategy to reduce reliance on China, projecting a decrease in receipts from 16% to 2% by the fourth quarter of fiscal 2025 [10]. - The company aims to produce 52% of its upholstered furniture in the U.S. and 21% in Italy by the end of 2025 [10]. Group 5: Product Development - RH is evolving from a home furnishings retailer to a luxury lifestyle brand, focusing on product design and quality enhancement [11]. - The launch of new sourcebooks and the introduction of a new design aesthetic, Japandi, are part of its strategy to elevate its product offerings [12]. Group 6: Earnings Outlook - RH's fiscal 2025 EPS estimate has risen to $10.87, reflecting a 101.7% year-over-year growth [8][14]. - Although earnings estimates for fiscal 2026 have decreased to $14.77, this still indicates a 35.9% year-over-year growth [15]. Group 7: Valuation - RH's stock is currently trading at a forward P/E ratio of 15.04X, which is lower than its competitors, suggesting a potentially attractive valuation for investors [17].

俄罗斯国防部表示，俄罗斯军队已占领乌克兰"顿涅茨克"的诺沃谢尔希夫卡（NOVOSERHIIVKA）和 舍夫琴科（SHEVCHENKO）定居点。 ...

Core Viewpoint - Investing in turnaround stocks can be challenging, but successful turnarounds can yield significant gains [1] Company Overview - RH, formerly known as Restoration Hardware, is undergoing a transformation despite a stagnant housing market [2][3] - The company has shifted its focus to selling high-end furniture to affluent consumers and has rebranded its stores as "design galleries" [3] Financial Performance - Initially, RH's strategy led to revenue growth and operating margins increasing from approximately 10% in 2015 to over 24% during the pandemic [4] - However, margins have since compressed to just under 10% as revenue declined, indicating vulnerability to housing market fluctuations [6] Debt and Buyback Strategy - In response to market conditions, RH took on significant debt, totaling about $2.55 billion, to repurchase $1 billion in stock in 2022 and an additional $1.25 billion in 2023 [8][9] - This buyback reduced shares outstanding by over 25%, but the debt burden raises concerns if the housing market does not recover [9] Housing Market Context - The CEO described the current housing market as the worst in 50 years, with existing home sales nearly unchanged despite a significant population increase [10] - The prolonged downturn has exceeded management's expectations, leading to regrets about the timing of stock repurchases [11] Future Outlook - Despite challenges, there are signs of potential recovery, with last quarter's revenue up 12% year-over-year, and management anticipates revenue growth of 10% to 13% for the year [14][15] - The company is also investing in new design galleries, including locations in Paris and six in the U.S. [15] Risks and Considerations - RH's enterprise value is around $5.1 billion, and the company remains vulnerable to a prolonged housing market freeze due to its debt load [16] - The outlook for recovery is uncertain, influenced by interest rates, tariffs, and broader economic conditions [17]

Group 1: RH (Restoration Hardware) - RH has faced macroeconomic challenges, including a weak housing market and tariff uncertainties, leading to a 52% decline in stock price this year [4] - The company's trailing-12-month revenue is $3.3 billion, down from a peak of $3.9 billion, but it reported a 12% year-over-year revenue growth in the latest quarter [5] - RH is expanding into the $200 billion North American hotel industry with RH Guesthouses and offers luxury services, creating a lifestyle ecosystem beyond furniture [6] - The company has historically reported higher margins than average furniture stores, with an adjusted operating margin of 7% in the first quarter, below its 10-year average of 12% [7] - The stock is currently trading at a price-to-sales multiple of 1.16, significantly below its 10-year average of over 2 times sales, presenting a buying opportunity for long-term investors [8] Group 2: Roku - Roku's stock is trading about 32% below its price from five years ago, despite showing double-digit revenue growth [10] - As a leading connected-TV streaming platform, Roku benefits from a growing digital advertising market, which constitutes the majority of its revenue [11] - The platform achieved 35.8 billion total streaming hours in the first quarter, a 16% year-over-year increase, indicating strong user engagement [13] - Roku's recent integration with Amazon Ads allows advertisers to access 80% of U.S. connected TV households, potentially boosting advertising revenue [14] - The stock is priced at a 2.74 price-to-sales multiple, at the low end of its historical range, suggesting potential for future gains as advertising investment increases [16]

Company Overview - RH is a leading luxury retailer in the home furnishing space, offering a wide range of merchandise including furniture, lighting, textiles, bathware, décor, outdoor and garden items, tableware, and furnishings for children and teens [11] Investment Ratings - RH currently holds a Zacks Rank of 3 (Hold) and has a VGM Score of B, indicating a moderate investment outlook [11] - The company has a Value Style Score of B, supported by attractive valuation metrics such as a forward P/E ratio of 16.81, which may appeal to value investors [12] Earnings Estimates - In the last 60 days, three analysts have revised their earnings estimates higher for fiscal 2026, with the Zacks Consensus Estimate increasing by $0.21 to $10.87 per share [12] - RH has demonstrated an average earnings surprise of 57.6%, suggesting potential for positive performance relative to expectations [12] Investment Considerations - With a solid Zacks Rank and strong Value and VGM Style Scores, RH is recommended for investors looking for potential opportunities in the luxury home furnishing sector [12]