Shares of RH (NYSE:RH) (formerly Restoration Hardware) rallied over 24% on Feb 24, post the release of its unaudited preliminary financial results for the fourth quarter and fiscal 2016on Feb 23.
Preliminary Q4 Results
RH reported preliminary adjusted earnings per share of 68 cents. The preliminary adjusted earnings figure is pegged higher than the Zacks Consensus Estimate of 65 cents by 4.6%. Adjusted earnings were within the expected range of 60 cents to 70 cents, down 30.6% from the prior-year quarter.
Restoration Hardware Holdings Inc. Price, Consensus and EPS Surprise
The company reported net revenue (GAAP) of $587 million. The Zacks Consensus Estimate is pegged higher at $589 million by 0.4%. Net revenue was within the expected range of $562 million to $592 million.
The company reported adjusted gross margin of approximately 34.6%
Preliminary FY16 Results
RH’s reported full-year adjusted earnings of $1.26 and revenues of $2.14 billion.
It also reported adjusted gross margin of approximately 32.8%, capital expenditures of around $181 million and cash and investments of approximately $281 million.
Management stated that several strategic investments and changes to its business model in fiscal 2016 had temporarily dented the financial results in the short term. However, these measures will strengthen its brand and position the business for accelerated growth in 2017 and beyond.
Notably, the final results for the fourth quarter and fiscal 2016 may vary materially from the preliminary information.
Zacks Rank & Stocks to Consider
RH currently has a Zacks Rank #2 (Buy).
Other favorably ranked stocks in the Retail-Wholesale sector include Potbelly Corporation (NASDAQ:PBPB) , At Home Group Inc. (NYSE:HOME) , Williams-Sonoma, Inc. (NYSE:WSM) .
Potbelly sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The company has surpassed earnings estimates in the past four quarters with an average beat of 39.8%.
At Home Group and Williams-Sonoma carry a Zacks Rank #2. Williams-Sonoma is expected to report its quarterly numbers on Mar 15, 2017.
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Restoration Hardware Holdings Inc. (RH): Free Stock Analysis Report
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