RH (RH) Stock Forecast & Price Target

RH has demonstrated strong financial performance, with a revenue increase of 8.9% to $884 million, outpacing both internal estimates and consensus projections, driven by growth in its core business and expanding restaurant and outlet locations. The company is experiencing positive momentum in demand, particularly evidenced by a 62% increase in sales at its Paris store over recent weeks, reflecting robust consumer interest. With a gross margin expansion of 79 basis points and continued industry-leading share gains, RH is well-positioned for future growth as it expands its addressable market and integrates a broader range of offerings.

The financial outlook for RH indicates significant concerns, particularly highlighted by the contraction of the operating margin, which fell 341 basis points year-over-year to 11.6%, underperforming against industry peers and below management's guidance. Additionally, the firm's 2025 EBITDA estimate has been revised downward to $686 million, reflecting a 6% decrease from prior guidance, primarily due to weaker revenue performance and ongoing tariff impacts. Furthermore, RH has revised its 2026 earnings per share estimate significantly down to $10.15 from a previous $12.35, signaling a negative shift in expected sales growth and raising concerns about the company's ability to meet its financial objectives.