Citigroup analyst Steven Zaccone has maintained a Neutral rating on RH (NYSE: RH) and raised the price target to $166 from the previous $150. The revision signals an updated valuation perspective while retaining a neutral stance on the stock's trajectory.

The adjustment follows a review of RH's market position and financial outlook. Despite the higher price target, the Neutral rating suggests that the stock's risk-reward profile remains balanced at current levels.

Rating and Price Target Details

The new price target represents an upside from the prior level, indicating a modestly improved outlook. Investors should note that the Neutral rating implies no strong buy or sell recommendation at this time.

RH reported better-than-expected first-quarter financial results for the period ended May 2, 2026, and raised its fiscal year 2026 sales outlook. The company posted an adjusted loss per share of $1.97, beating the consensus estimate of a $2.11 loss, while revenue from operations declined 1.67% year-over-year to $800.328 million, exceeding the analyst consensus of $792.780 million. Despite the earnings beat, the loss per share represents a significant decrease compared to earnings of $0.13 per share in the same period last year. RH shares fell more than 6% following the announcement as the company issued weaker-than-expected second-quarter revenue guidance.

RH raised its fiscal year 2026 sales outlook to a range of $3.594 billion to $3.715 billion, compared to the previous range of $3.577 billion to $3.715 billion. The updated guidance exceeds the analyst estimate of $3.619 billion. The company projects revenue growth of 4.5% to 8% and an adjusted EBITDA margin of 14.2% to 16% for the full year. This outlook factors in an approximate negative 270 basis point impact from pre-opening and startup costs related to international expansion. For the second quarter of fiscal 2026, RH projects sales between $903.647 million and $921.630 million, below the Wall Street consensus estimate of $937.8 million, with revenue growth of 0.5% to 2.5% and an adjusted EBITDA margin of 11.5% to 13%.

Chairman and Chief Executive Officer Gary Friedman announced the launch of RH Estates, a new platform aiming to merge high-end design with accessibility. The initiative offers bespoke and couture options, including RH Bespoke furniture and RH Couture upholstery, allowing interior designers and architects to specify custom dimensions and materials. Management emphasized that this move removes barriers between taste and scale, opening the trade-only market to consumers. Additionally, RH is introducing a loyalty program for trade clients to enhance engagement with interior designers.

International expansion remains a key focus, with openings in Paris, Milan, and London expected to solidify RH's global luxury brand status. The company noted that back order and special order balances were approximately $75 million higher than a year ago, primarily due to tariff-related resourcing. RH leadership expects these balances to contribute 4.5 percentage points to revenue growth in the second half of the fiscal year.

Analyst Action

Several analysts updated their price targets on RH following the earnings announcement:

• Baird analyst Peter Benedict maintained RH with a Neutral rating and raised the price target from $125 to $150.
• Wells Fargo analyst Zachary Fadem maintained the stock with an Overweight rating and raised the price target from $160 to $175.
• Stifel analyst W. Andrew Carter maintained RH with a Hold rating and raised the price target from $110 to $130.
• Guggenheim analyst Steven Forbes reiterated a Buy rating on the stock with a $200 price forecast. Forbes noted that adjusted EBITDA came in about 30% above expectations and that the next 12 months "could reshape the consensus investment narrative" around the company.

Financial Outlook