BNP Paribas Exane Reaffirms Underperform Rating for RH (NYSE:RH)

Key Points

• BNP Paribas Exane reaffirmed its “underperform” rating on RH and cut its price target to $81 from $90, implying roughly 41% downside from the prior close.
• RH’s latest quarter exceeded expectations, with EPS of $2.70 versus a $0.38 consensus and revenue of $922.15 million, up 2.6% year over year. However, analysts warned that tariff refunds boosted profitability while underlying sales and margins remained pressured.
• Analyst sentiment remains mixed: RH has a consensus “hold” rating and a $165.57 price target, while Bank of America also issued an “underperform” rating and cited below-consensus third-quarter revenue guidance.

RH (NYSE:RH - Get Free Report)'s stock had its "underperform" rating restated by equities researchers at BNP Paribas Exane in a report released on Friday, Benzinga reports. They presently have a $81.00 target price on the stock, down from their prior target price of $90.00. BNP Paribas Exane's price target would suggest a potential downside of 40.71% from the stock's previous close.

RH has been the subject of several other research reports. Zacks Research raised RH from a "strong sell" rating to a "hold" rating in a report on Tuesday, June 16th. Morgan Stanley set a $210.00 price target on shares of RH in a research note on Friday. KeyCorp reissued a "sector weight" rating on shares of RH in a report on Friday, June 12th. Weiss Ratings reaffirmed a "sell (d)" rating on shares of RH in a report on Friday, July 24th. Finally, JPMorgan Chase & Co. cut their target price on shares of RH from $212.00 to $190.00 and set an "overweight" rating for the company in a research report on Friday. Seven analysts have rated the stock with a Buy rating, ten have assigned a Hold rating and three have assigned a Sell rating to the company's stock. Based on data from MarketBeat, the company presently has a consensus rating of "Hold" and a consensus price target of $165.57.

RH Price Performance

NYSE:RH traded up $2.60 during trading hours on Friday, hitting $136.62. The stock had a trading volume of 1,265,747 shares, compared to its average volume of 1,030,150. The company has a 50 day simple moving average of $167.02 and a two-hundred day simple moving average of $150.20. The firm has a market capitalization of $2.58 billion, a price-to-earnings ratio of 26.41, a P/E/G ratio of 3.32 and a beta of 1.85. The company has a debt-to-equity ratio of 54.96, a current ratio of 1.13 and a quick ratio of 0.32. RH has a one year low of $106.30 and a one year high of $248.44.

RH (NYSE:RH - Get Free Report) last released its quarterly earnings results on Thursday, September 10th. The company reported $2.70 earnings per share for the quarter, topping the consensus estimate of $0.38 by $2.32. RH had a net margin of 3.01% and a return on equity of 423.79%. The firm had revenue of $922.15 million for the quarter, compared to analysts' expectations of $915.09 million. During the same quarter in the prior year, the firm posted $2.93 earnings per share. The business's quarterly revenue was up 2.6% on a year-over-year basis. Research analysts forecast that RH will post 4.2 earnings per share for the current fiscal year.

Insider Activity at RH

In other news, CEO Gary G. Friedman sold 69,069 shares of the firm's stock in a transaction dated Monday, July 6th. The stock was sold at an average price of $169.48, for a total transaction of $11,705,814.12. Following the transaction, the chief executive officer directly owned 3,282,268 shares of the company's stock, valued at approximately $556,278,780.64. This trade represents a 2.06% decrease in their ownership of the stock. The sale was disclosed in a filing with the Securities & Exchange Commission, which can be accessed through this hyperlink. Also, Director Carlos Alberini acquired 11,388 shares of the firm's stock in a transaction dated Monday, June 29th. The stock was bought at an average price of $160.90 per share, for a total transaction of $1,832,329.20. Following the acquisition, the director owned 32,190 shares of the company's stock, valued at approximately $5,179,371. This trade represents a 54.74% increase in their position. The disclosure for this purchase is available in the SEC filing. In the last 90 days, insiders have sold 132,749 shares of company stock valued at $21,856,812. Insiders own 26.90% of the company's stock.

Hedge Funds Weigh In On RH

Several institutional investors and hedge funds have recently bought and sold shares of RH. Belpointe Asset Management LLC lifted its position in RH by 3.5% during the second quarter. Belpointe Asset Management LLC now owns 2,217 shares of the company's stock valued at $365,000 after purchasing an additional 75 shares during the period. D.B. Root & Company LLC grew its position in RH by 0.9% during the 2nd quarter. D.B. Root & Company LLC now owns 8,413 shares of the company's stock worth $1,386,000 after purchasing an additional 78 shares during the period. Public Employees Retirement System of Ohio grew its position in RH by 1.6% during the 3rd quarter. Public Employees Retirement System of Ohio now owns 5,122 shares of the company's stock worth $1,041,000 after purchasing an additional 81 shares during the period. US Bancorp DE raised its stake in shares of RH by 30.8% during the 3rd quarter. US Bancorp DE now owns 416 shares of the company's stock valued at $85,000 after buying an additional 98 shares during the last quarter. Finally, Oregon Public Employees Retirement Fund raised its stake in shares of RH by 3.3% during the 1st quarter. Oregon Public Employees Retirement Fund now owns 3,170 shares of the company's stock valued at $443,000 after buying an additional 100 shares during the last quarter. 90.17% of the stock is currently owned by institutional investors.

Key Stories Impacting RH

Here are the key news stories impacting RH this week:

• Positive Sentiment: RH reported second-quarter EPS of $2.70, far above the roughly $0.38–$0.42 analyst consensus. Revenue rose 2.6% year over year to approximately $922 million, slightly above some estimates. The results helped drive a premarket rally. RH Stock Rallies After Mixed Q2 Print
• Positive Sentiment: Management projected fiscal 2026 revenue of $3.6 billion to $3.7 billion, above the approximately $3.5 billion consensus. Investors are also focused on RH Estates, which management believes could substantially expand the company’s addressable market and represent half of its offering within five years. RH Projects Fiscal 2026 Revenue Growth
• Positive Sentiment: Guggenheim reaffirmed its “buy” rating with a $200 price target, while TD Cowen maintained a “buy” rating despite lowering its target to $190. Both targets imply substantial upside from recent trading levels.
• Positive Sentiment: Telsey Advisory Group raised its price target to $155 from $140, although it retained a “market perform” rating, reflecting modest confidence in the recovery outlook.
• Neutral Sentiment: Robert W. Baird lowered its target to $160 from $165 and kept a “neutral” rating. William Blair analyst Phillip Blee also maintained a “hold” stance, indicating that the earnings beat has not fully resolved concerns about the business trajectory.
• Negative Sentiment: Analysts cautioned that tariff refunds materially supported the quarter’s profitability, potentially masking persistent margin pressure and weakness in underlying or core sales. Operating profit reportedly declined year over year despite higher gross profit. RH Tariff Benefits Mask Enduring Margin Pressure
• Negative Sentiment: Bank of America cut its price target sharply to $114 from $156 and assigned an “underperform” rating, citing downside risk. RH’s third-quarter revenue guidance of $928 million to $936.8 million is also below the roughly $964 million consensus, tempering the bullish reaction to the quarterly EPS beat.

About RH

RH, formerly Restoration Hardware, is a design-driven luxury retailer specializing in high-end home furnishings, décor, textiles, lighting and outdoor living products. The company offers a curated collection of furniture pieces—including seating, casegoods, beds and dining items—alongside rugs, art and decorative accessories. RH's product lines are organized into distinct collections, each reflecting a cohesive design philosophy and premium craftsmanship aimed at the residential and hospitality markets.

Founded in 1979 in Eureka, California, by Stephen Gordon, Restoration Hardware began as a small warehouse in Northern California.

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