Retail
How Analysts Reacted to Restoration Hardware Earnings
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When Restoration Hardware Holdings Inc. (NYSE: RH) reported earnings last Tuesday, the company missed earnings per share estimates by nearly 30%. Revenues were up about 11% year over year, but they were also lower than estimates. Shares bounced around in after-hours trading, but by Wednesday morning shares opened just 10 cents below their closing price on Tuesday.
What appears to have happened is that analysts pared their estimates but remained bullish on the company’s plans going forward. Fourth-quarter revenues were hit by delays in the roll-out of new products in Restoration Hardware’s RH Modern division, and the company said that it plans to invest more in that division, cutting an estimated 22 cents from its adjusted earnings per share in 2016.
For the first quarter of fiscal 2016, the company expects net revenues in the range of $452 million to $456 million, compared with $422 million a year ago. Estimated adjusted earnings per share have been trimmed to $0.05, compared with $0.23 reported in the first quarter of fiscal 2015.
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