Wells Fargo lowered the firm’s price target on RH (RH) to $375 from $500 and keeps an Overweight rating on the shares. The firm attributes RH’s year-to-date selloff to crowded positioning/factors, a levered balance sheet and category/macro/tariff concerns. But Wells expects a Q4 beat with enough encouraging Q1 data points to suggest ongoing category outperformance. The firm likes the Q4 setup on signs that near-term demand is holding in and long-term idiosyncratic levers intact. Cautious macro warrants 2025 conservatism, but at 17-turns, intact sales/margin upside would spell relief, it adds.
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Read More on RH:
- Positive Outlook on RH: Buy Rating Supported by Strong Market Position and Potential Rebound
- RH removed from Best Ideas List at Wedbush
- RH upgraded to Neutral from Sell at Goldman Sachs
- RH may soon need to raise ‘dilutive capital,’ Hunterbrook says in short report
- RH down 2% after Hunterbrook publishes short report
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