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Restoration Hardware Earnings: RH Stock Drops 2% Despite Q3 Earnings Beat

RH beat EPS and revenue estimates for the quarter

Restoration Hardware (NYSE:RH) earnings for the furniture company’s third quarter of 2019 have RH stock down in after-hours trading on Wednesday. This comes after reporting an adjusted EPS of $2.79 on revenue of $677.50 million. For comparison, Wall Street was expecting per-share earnings of $2.23 on revenue of $676.39 million for the quarter.

Restoration Hardware Earnings: RH Stock Drops 2% Despite Q3 Earnings Beat
Source: Andriy Blokhin / Shutterstock.com

Let’s take a closer look at the most recent Restoration Hardware earnings report.

  • Adjusted earnings per share come in 74% higher than the $1.50 reported during the same time last year.
  • Revenue is sitting up 6.40% compared to the $636.60 million reported in Q3 2018.
  • Operating income of $89.20 million is 111% better YoY than $42.20 million.
  • The Restoration Hardware earnings report also has net income coming in at $52.50 million.
  • That’s a 161% increase from the company’s net income of $20.10 million in the same period of the year prior.

Restoration Hardware includes this statement alongside the RH stock earnings results.

“We have spent decades building a business model that generates industry leading profitability and return on invested capital, and believe real models will become wildly popular in the post WeWork era.

We also believe this recent period has been reminiscent of previous times when growth without profitability has been unjustly rewarded, and valuations were based on the misplaced belief that an online retail business is more profitable than a physical store.”

The Restoration Hardware earnings report also includes an update to its long-term outlook. That includes a new net revenue growth goal of 8% to 12%, as well as adjusted net income growth of 15% to 20%.

RH stock was down 2.25% after markets closed on Wednesday. The stock closed out the day up 2.86%.

As of this writing, William White did not hold a position in any of the aforementioned securities.


Article printed from InvestorPlace Media, https://investorplace.com/2019/12/restoration-hardware-earnings-dips-rh-stock/.

©2019 InvestorPlace Media, LLC