RH (RH) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:RH - US74967X1037 - Common Stock
228.88 USD
-2.13 (-0.92%)
RH gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 121 industry peers in the Specialty Retail industry. RH has a medium profitability rating, but doesn't score so well on its financial health evaluation. RH is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
- RH had positive earnings in the past year.
- In the past year RH had a positive cash flow from operations.
- Each year in the past 5 years RH has been profitable.
- Each year in the past 5 years RH had a positive operating cash flow.
1.2 Ratios
- RH has a Return On Assets (2.29%) which is comparable to the rest of the industry.
- RH has a better Return On Equity (3285.39%) than 100.00% of its industry peers.
- Looking at the Return On Invested Capital, with a value of 8.26%, RH is in the better half of the industry, outperforming 68.59% of the companies in the same industry.
- RH had an Average Return On Invested Capital over the past 3 years of 10.73%. This is in line with the industry average of 12.37%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.29% | ||
| ROE | 3285.39% | ||
| ROIC | 8.26% |
ROA(3y)4.87%
ROA(5y)7.29%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)10.73%
ROIC(5y)14.31%
1.3 Margins
- Looking at the Profit Margin, with a value of 3.22%, RH is in the better half of the industry, outperforming 69.42% of the companies in the same industry.
- In the last couple of years the Profit Margin of RH has declined.
- With an excellent Operating Margin value of 10.49%, RH belongs to the best of the industry, outperforming 84.30% of the companies in the same industry.
- RH's Operating Margin has declined in the last couple of years.
- Looking at the Gross Margin, with a value of 44.50%, RH is in the better half of the industry, outperforming 71.07% of the companies in the same industry.
- RH's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 10.49% | ||
| PM (TTM) | 3.22% | ||
| GM | 44.5% |
OM growth 3Y-26.37%
OM growth 5Y-6.4%
PM growth 3Y-50.1%
PM growth 5Y-22.84%
GM growth 3Y-3.41%
GM growth 5Y1.47%
2. Health
2.1 Basic Checks
- RH has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
- RH has more shares outstanding than it did 1 year ago.
- RH has less shares outstanding than it did 5 years ago.
- Compared to 1 year ago, RH has an improved debt to assets ratio.
2.2 Solvency
- Based on the Altman-Z score of 1.42, we must say that RH is in the distress zone and has some risk of bankruptcy.
- RH has a Altman-Z score of 1.42. This is in the lower half of the industry: RH underperforms 66.12% of its industry peers.
- RH has a debt to FCF ratio of 25.66. This is a negative value and a sign of low solvency as RH would need 25.66 years to pay back of all of its debts.
- RH has a Debt to FCF ratio (25.66) which is in line with its industry peers.
- A Debt/Equity ratio of 944.39 is on the high side and indicates that RH has dependencies on debt financing.
- With a Debt to Equity ratio value of 944.39, RH is not doing good in the industry: 80.99% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 944.39 | ||
| Debt/FCF | 25.66 | ||
| Altman-Z | 1.42 |
ROIC/WACC0.8
WACC10.31%
2.3 Liquidity
- RH has a Current Ratio of 1.19. This is a normal value and indicates that RH is financially healthy and should not expect problems in meeting its short term obligations.
- Looking at the Current ratio, with a value of 1.19, RH is doing worse than 61.16% of the companies in the same industry.
- A Quick Ratio of 0.26 indicates that RH may have some problems paying its short term obligations.
- Looking at the Quick ratio, with a value of 0.26, RH is doing worse than 80.17% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.19 | ||
| Quick Ratio | 0.26 |
3. Growth
3.1 Past
- The Earnings Per Share has grown by an impressive 41.43% over the past year.
- The earnings per share for RH have been decreasing by -14.46% on average. This is quite bad
- Looking at the last year, RH shows a quite strong growth in Revenue. The Revenue has grown by 9.74% in the last year.
- RH shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 3.74% yearly.
EPS 1Y (TTM)41.43%
EPS 3Y-41.01%
EPS 5Y-14.46%
EPS Q2Q%-31.05%
Revenue 1Y (TTM)9.74%
Revenue growth 3Y-5.41%
Revenue growth 5Y3.74%
Sales Q2Q%8.88%
3.2 Future
- Based on estimates for the next years, RH will show a very strong growth in Earnings Per Share. The EPS will grow by 45.55% on average per year.
- The Revenue is expected to grow by 8.19% on average over the next years. This is quite good.
EPS Next Y36.4%
EPS Next 2Y41.7%
EPS Next 3Y39.79%
EPS Next 5Y45.55%
Revenue Next Year8.46%
Revenue Next 2Y8.68%
Revenue Next 3Y8.41%
Revenue Next 5Y8.19%
3.3 Evolution
- The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
- The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- With a Price/Earnings ratio of 36.04, RH can be considered very expensive at the moment.
- Compared to the rest of the industry, the Price/Earnings ratio of RH is on the same level as its industry peers.
- RH is valuated rather expensively when we compare the Price/Earnings ratio to 27.30, which is the current average of the S&P500 Index.
- RH is valuated rather expensively with a Price/Forward Earnings ratio of 21.31.
- RH's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. RH is cheaper than 61.98% of the companies in the same industry.
- Compared to an average S&P500 Price/Forward Earnings ratio of 24.32, RH is valued at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 36.04 | ||
| Fwd PE | 21.31 |
4.2 Price Multiples
- The rest of the industry has a similar Enterprise Value to EBITDA ratio as RH.
- RH's Price/Free Cash Flow ratio is in line with the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 34.35 | ||
| EV/EBITDA | 14.99 |
4.3 Compensation for Growth
- The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
- The decent profitability rating of RH may justify a higher PE ratio.
- A more expensive valuation may be justified as RH's earnings are expected to grow with 39.79% in the coming years.
PEG (NY)0.99
PEG (5Y)N/A
EPS Next 2Y41.7%
EPS Next 3Y39.79%
5. Dividend
5.1 Amount
- RH does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0% |
RH / RH FAQ
Can you provide the ChartMill fundamental rating for RH?
ChartMill assigns a fundamental rating of 4 / 10 to RH.
Can you provide the valuation status for RH?
ChartMill assigns a valuation rating of 4 / 10 to RH (RH). This can be considered as Fairly Valued.
Can you provide the profitability details for RH?
RH (RH) has a profitability rating of 6 / 10.
What is the valuation of RH based on its PE and PB ratios?
The Price/Earnings (PE) ratio for RH (RH) is 36.04 and the Price/Book (PB) ratio is 1282.58.