RH is set to report its earnings after the close on Thursday. The stock has recently hit a record high of $744.56 in 2021 and is currently trading near $277. The stock has a history of making big moves following earnings reports, either gapping up if the numbers are strong or gapping down if they disappoint. The Street is expecting the company to report a loss of ($0.08)/share on $724.67 million in revenue, with a Whisper number of a loss of ($0.01)/share, which represents the unofficial view on earnings.
Looking at the fundamentals of the company, earnings have fluctuated over the past few years. Earnings steadily increased from 2018 to 2023, are projected to decrease significantly in 2024, and then slowly rebound in 2025 and 2026. The company earned $19.90 in 2023 and $26.12 in 2022. The expected earnings for 2024 are $6.82/share, a substantial drop from previous years. The price to earnings ratio (P/E) is 44, which is 1.9x the S&P 500. Additionally, the number of high ranked funds that own the stock has grown from 502 to 574.
On the technical side, the stock is currently trading 32% below its 52-week high. It is trading just above its 200-day moving average (DMA) line, but its 50 DMA line is below the 200 DMA line, which is not typically a bullish sign in the market. However, a gap up after earnings could lead to a continued rally, while a gap down could result in hitting new multi-year lows. RH operates as a retailer in the home furnishings market, offering a variety of products through various online channels as well as physical stores in the United States, Canada, the United Kingdom, and Germany.
As investors await the earnings report, it is important to pay attention to how the stock reacts to the news. Monitoring the market’s response and the company’s performance can provide valuable insights for future investment decisions. It is advised to keep losses small and not argue with the market trends. The stock has been featured on FindLeadingStocks.com, a member’s only newsletter that shares information on stocks breaking out or setting up for potential growth. Interested individuals can take advantage of a free trial to explore the benefits of finding and owning leading stocks in the market.
