RH Common Stock (RH)

FairStock Score: 48/100 — MIXED

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

As a value investor, I start with the business and the price. RH is a branded home-furnishings retailer with galleries in several countries, but it sells discretionary goods in a cyclical industry. The filed numbers are mixed. In fiscal Q2 2026, the quarter ended 2026-08-01, revenue was $922.1 million, net income was $60.2 million, and diluted EPS was $3.06. In fiscal Q1 2026, the quarter ended 2026-05-02, RH lost $13.7 million, or $0.73 per diluted share. For FY2025, ended 2026-01-31, revenue was $3.4 billion, net income was $124.8 million, and diluted EPS was $6.31. FY2023, ended 2024-02-03, had net income of $127.6 million and diluted EPS of $5.91, so profits have not compounded. FairStock classifies it as a SLOW GROWER — Shrinking, citing profit -14.4% a year over five years and revenue growth of 3.8%. At the close on 2026-10-13, the price was $115.88, giving a FairStock P/E of 20.47, P/B of 35.99, and FairStock Score of 48/100. The FairStock Graham Number is $28.46, leaving a margin of safety of -307.17%, so the price is far above a conservative value estimate. FairStock ROCE is only 3.42%, while ROE is 280.72% mostly because equity is thin; the FairStock Altman Z-Score is 0.45, a warning sign. The offset is cash generation: TTM free cash flow is $250.4 million and FairStock FCF yield is 11.4%. FairStock Piotroski is 7/9. The brand may have some loyalty, but current returns suggest no strong durable moat. This is not a classic Graham bargain; it is a volatile, levered retailer whose cash flow must improve before the price looks comfortable.

In plain English: RH sells high-end furniture and home decorations through stores and online. The company is profitable, but sales are growing slowly and profits have fallen over the past few years. The stock price looks high compared with the company's assets and recent earnings, even though the business produces a lot of cash.

The full AI analysis, bull and bear case and key monitorables are in FairStock Pro.

Data as of 2026-10-13 close · note generated 2026-10-15 · model deepseek-flash

Sources (SEC EDGAR): fiscal Q2 2026 10-Q (period ended 2026-08-01) · fiscal Q1 2026 10-Q (period ended 2026-05-02) · fiscal Q3 2025 10-Q (period ended 2025-11-01) · fiscal Q2 2025 10-Q (period ended 2025-08-02) · FY2025 10-K (period ended 2026-01-31) · FY2024 10-K (period ended 2025-02-01) · FY2023 10-K (period ended 2024-02-03)

Fundamentals from company filings and market-data providers; prices are end-of-day, not real-time. AI-generated analysis is general and educational — not personal investment advice. Scoring methodology · Score test · Disclaimer