logo
Plus   Neg
Share
Email

RH Stock Jumps 23%, Blames Higher Prices On Trade War

rhhardware-trump-061319-lt.jpg

Shares of RH, the retail chain formerly known as Restoration Hardware, surged 23% on Wednesday's extended trading session after the luxury-furniture retailer lifted its full-year outlook. Also, RH said it will charge higher prices due to President Trump's trade war China.

First-quarter profit rose to $35.7 million or $1.43 per share from $25.5 million or $1.01 per share last year.

Adjusted earnings for the quarter rose to $1.85 per share from $1.21 per share last year. Analysts polled by Thomson Reuters estimated earnings of $1.55 per share for the quarter.

Revenues for the quarter rose 7.4% to $598.4 million from $557.4 million last year. Analysts had a consensus revenue estimate of $584.25 million for the quarter.

Looking forward to fiscal year 2019, the company now expects revenues of $2.64 billion to $2.66 billion and adjusted earnings of $8.76 to $9.27 per share. Analysts currently estimate earnings of $8.40 per share and revenues of $2.61 billion for the year.

Previously, the company expected earnings of $8.05 to $8.69 a share and sales of $2.59 billion to $2.64 billion.

Regarding China tariffs, CEO Gary Friedman said the company has renegotiated product costs and selectively raised prices to mitigate the impact of the increase from 10 to 25 percent.

"We are also moving certain production and new product development out of China, plus exploring new partnerships and expanding our own manufacturing facilities in the United States. Long term, we do not believe the current trade climate will impair our ability to achieve our stated financial goals and the expected impact from the increased tariffs is embedded in our guidance for the year."

RH closed Thursday's trading at $131.93, up $2.53 or 1.96%, on the NYSE. The stock, however, slipped $22.43 or 17.00% in the after-hours trade.

For comments and feedback contact: editorial@rttnews.com

Business News

Follow RTT