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RH Earnings: Why RH Stock Is Skyrocketing 21% Today

RH (NYSE:RH) earnings for the home furnishings company’s second quarter of 2020 have RH stock flying high on Thursday. That’s thanks to its adjusted earnings per share of $4.90 beating out Wall Street’s estimate of $3.41. The company’s revenue of $709.28 million also comes in above analysts’ estimates of $704.05 million.

Restoration Hardware (RH) home furniture specialty store, shop, entrance with people walking in shopping mall in Virginia
Source: Andriy Blokhin / Shutterstock.com

Here are some additional highlights from the most recent RH earnings report.

  • Adjusted per-share earnings are up 53% from $3.20 in the second quarter of 2019.
  • Revenue for the quarter comes in just slightly above the $706.51 million reported in the same period of the year prior.
  • Operating income of $136.57 million is a 31.3% increase year-over-year from $103.98 million.
  • The RH earnings report also has net income coming in at $98.42 million.
  • That’s a 54.4% jump from the company’s net income of $63.76 million

Gary Friedman, CEO of RH, said the following in a letter to RH shareholders.

“The emergence of RH as a luxury brand generating luxury margins has arrived years sooner than expected and we now believe we will reach 20% adjusted operating margin in fiscal 2020 with mid single digit revenue growth. If revenues grow at a higher rate in the second half, we would expect adjusted operating margins to expand beyond 20%, and now see a long term path to 25% adjusted operating margins.”

RH doesn’t provide specific numbers in its outlook. However, it does say it expects increased spending on the home to continue in the second half of 2020 and into 2021.

RH stock was up 21.2% as of Thursday afternoon.

On the date of publication, William White did not have (either directly or indirectly) any positions in the securities mentioned in this article.

Article printed from InvestorPlace Media, https://investorplace.com/2020/09/rh-earnings-push-stock-higher/.

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