Market Overview

Restoration Hardware Restored To A Buy Rating At Deutsche

Share:
Restoration Hardware Restored To A Buy Rating At Deutsche

RH (NYSE: RH) continues to win back the Street after a poor performance throughout 2016. Deutsche Bank's Adam Sindler upgrades RH's stock rating from Hold to Buy with a price target boosted from $80 to $84.

Sindler actually downgraded RH to Hold a few weeks before its second-quarter earnings report due to his belief that the business had "stabilized" and the company needs to convince the Street that there is room for upside. And this is exactly what happened in the earnings report when management's gross margin guidance for the bottom half of 2017 came in "well ahead of expectations."

tipranks.png

In fact, RH can likely stabilize its gross margins in the 36–37 percent range, which is near peak levels, Sindler noted. On several occasions, the company's quarterly margin rate moved above 38 percent and while the analyst's model doesn't assume this level of rebound it does serve as a key element of upside moving forward.

Looking forward, Sindler is modeling RH to see its total sales rise 10 percent on annual basis, which is at the midpoint of the company's own 8–12 percent projection. Also, improved new store productivity and a better than expected recovery in the first half of 2018 will add to the bullish story.

At time of publication, shares of RH were up 3.36 percent at $74.04.

Related Links:

RH Nearly Doubles After Q2 Beat And Raise

RH's Blowout Quarter Makes Believers Out Of Some, But Not All

Latest Ratings for RH

DateFirmActionFromTo
Oct 2020BarclaysMaintainsOverweight
Sep 2020Cowen & Co.UpgradesMarket PerformOutperform
Sep 2020Wells FargoMaintainsOverweight

View More Analyst Ratings for RH
View the Latest Analyst Ratings

 

Related Articles (RH)

View Comments and Join the Discussion!

Posted-In: Adam SindlerAnalyst Color Long Ideas News Upgrades Analyst Ratings Movers Trading Ideas Best of Benzinga

Latest Ratings

StockFirmActionPT
CPRIDeutsche BankUpgrades56.0
SPOTRosenblattMaintains390.0
TELLWolfe ResearchUpgrades5.0
SRGuggenheimUpgrades72.0
SLFCanaccord GenuityUpgrades66.0
View the Latest Analytics Ratings
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Premarket Activity
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Fintech Focus
A daily collection of all things fintech, interesting developments and market updates.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at vipaccounts@benzinga.com