Restoration Hardware Holdings Earnings: Here’s Why Shares are Down Now

Restoration Hardware Holdings (NYSE:RH) delivered a profit and beat Wall Street’s expectations, AND beat the revenue expectation. The revenue beat is a positive sign to shareholders seeking high growth out of the company. Shares are down 1.47%.

Restoration Hardware Holdings Earnings Cheat Sheet

Revenue: Rose 30.45% to $382.1 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Restoration Hardware Holdings reported adjusted EPS income of $0.49 per share. By that measure, the company beat the mean analyst estimate of $0.43. It beat the average revenue estimate of $377.6 million.

Quoting Management: Gary Friedman, Chairman, Creator, Curator, and Co-Chief Executive Officer, said, “We are pleased to announce record financial results for the second quarter. Our industry-leading performance is a reflection of our ability to innovate, curate and integrate new products and businesses offering an unmatched customer experience. We continued to take market share during the quarter, delivering 30% growth in net revenues driven by a comp store sales increase of 26% on top of 31% comp growth last year and 17% percent in 2011. We significantly expanded our operating margin and increased adjusted net income by 62% while at the same time continued to invest in our infrastructure and new businesses to support our future growth.”

Key Stats (on next page)…

Revenue increased 26.8% from $301.34 million in the previous quarter. EPS increased 716.67% from $0.06 in the previous quarter.

Looking Forward: Analysts have a neutral outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings is a profit of $0.16 and has not changed. For the current year, the average estimate has moved up from a profit of $1.40 to a profit of $1.48 over the last ninety days.

Stocks with improving earnings metrics are worthy of your extra attention. In fact, “E = Earnings Are Increasing Quarter-Over-Quarter” is a core component of our CHEAT SHEET investing framework for this very reason. Don’t waste another minute – click here and get our CHEAT SHEET stock picks now.

(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at] wallstcheatsheet.com)