RH Is Poised For 'Positive Inflection' In 2025 Earnings: Analyst

Core Viewpoint - RH is experiencing an early positive inflection after three years of demand contraction, weak housing turnover, and margin compression, as noted by Morgan Stanley [1] Group 1: Analyst Upgrade - Analyst Simeon Gutman upgraded RH's rating from Equal-Weight to Overweight and raised the price target from $435 to$530 [1][2] Group 2: Future Outlook - The path for RH is expected to turn decisively positive into 2025, with a focus on long-term fundamentals [2] - The launch of new collections, including 54 new collections in the RH Modern Sourcebook and 97 new collections in the RH Interiors and RH Outdoor Sourcebooks, is anticipated to unlock pent-up demand through 2025 [3] Group 3: Macro Environment - The macro environment is improving, with factors such as the end of reversion, a positive wealth effect for upper-income households, and the conclusion of the election contributing to this improvement [4] - Tariff risks are mitigated as RH has largely moved sourcing away from China, with exposure to Mexico also transitioning [4] Group 4: Stock Performance - At the time of publication, RH shares had risen by 0.69% to $417 [4]