Ehhh, What's Up With RH? A Hare-Raising Look at Luxury Home Goods!

Of Course There's Always a Problem!

Eh what's up doc? Yours truly Bugs Bunny reporting live from my rabbit hole where the news is always hoppin'! Today's special? RH that fancy schmancy home goods company. They're sitting pretty with their high end stuff and a decent chunk of the market which is nice and all but get this they're apparently singin' the blues over the housing market! As the CEO some guy named Gary Friedman would say we're operating in a tough market! I remember when a home was just a hole in the ground. Now ya need a butler and a fancy chandelier too?

Hokey Smokes Tariffs!

Now this is where it gets interesting folks. Like Yosemite Sam after a bad shave RH is steaming mad about tariffs! Seems like 40% of their goodies come from overseas and those pesky tariffs are biting into their profits. They missed their earnings target in April 2025 and the stock took a nosedive faster than me escaping Elmer Fudd! Remember some people just cant stand to see you happy... and some tariffs cant stand to see you profitable!

International Intrigue Doc?

But hold on to your carrots folks because RH isn't backing down. They're going global baby! They're expanding into Europe and Asia trying to snag those high roller customers. They have a hospitality and international expansion strategy which may or may not turn out well. As they say 'this means WAR' they're looking for a bigger piece of the pie in the long run. And they want a Guesthouse for some reason!

Money Money Money!

Alright let's talk greenbacks dollahs moolah! RH's got a bit of debt about $3.9 billion and they're spending big bucks on those fancy international stores. Their cash flow looks a little shall we say anemic? Only 30.4 million in cash in the most recent report. Seems like they are spending money to make money and what could go wrong?

Buybacks Gone Bad?

And get this they spent a pile of dough on buying back their own shares in 2023 and 2024. Hindsight is 20/20 right? Now it looks like they might have jumped the gun on that one and they dont have the money to repeat that stunt in the short term. Eh sometimes you win sometimes you lose. But i'm here to tell you that rabbits are always better at calculating stock positions than humans. No offense.

The Carrot at the End of the Tunnel

So what's the bottom line doc? RH's stock valuation is at the low end of its range. They're trading at about 18.7 times their forward earnings estimates which is below their 5 year average. I would say its time to invest but i'm a rabbit. So take my advice with a grain of salt. Or a carrot. So keep your eyes peeled folks because this RH story is far from over. And remember that's all folks! (for now)