📊 RH Key Takeaways
Is Rh (RH) a Good Investment?
RH is in financial distress with extreme leverage (42.55x debt-to-equity), minimal equity cushion ($56.9M vs $4.9B liabilities), and critically low interest coverage (0.2x), indicating inability to service $2.4B in debt from operating income. While revenue grows 8.1% and profitability is improving, the capital structure is near-insolvency and leaves no margin for error.
RH delivers robust gross and operating margins with mid‑single‑digit revenue growth and solid free cash flow generation. However, a highly levered balance sheet, minimal equity cushion, and thin interest coverage suppress net profitability and raise downside risk if demand or rates worsen.
Rh Key Strengths (RH)
- Revenue growing 8.1% YoY with 41.4% gross margin showing core business viability
- Net income loss narrowing significantly (+72.3% YoY) trending toward breakeven
- Positive free cash flow ($13.3M) generated despite GAAP losses
- High gross margin (44.1%) and solid operating margin (11.3%)
- Consistent free cash flow generation (7.3% FCF margin)
- Revenue growth of 8.1% YoY despite a challenging category
RH Stock Risks: Rh Investment Risks
- Extreme leverage with debt-to-equity of 42.55x and stockholders equity only $56.9M
- Interest coverage of 0.2x—company cannot cover interest expense from operating income, indicating debt service vulnerability
- Negative returns (ROE -24.1%, ROA -0.3%) and unprofitable (net margin -1.7%) with minimal operating margin (4.3%)
- Working capital severely constrained with current ratio of 1.13x, providing almost no liquidity buffer
- Thin free cash flow margin (1.7%) leaves negligible flexibility for unexpected shocks
- Very high leverage with low interest coverage (2.2x) and minimal equity
- Low cash balance versus long-term debt ($41M vs $2.42B)
- EPS growth appears driven by buybacks despite flat net income
Key Metrics to Watch
- Interest coverage ratio—must improve above 1.5x to demonstrate debt serviceability
- Operating margin expansion—critical to reach 8-10%+ for sustainable profitability
- Debt-to-EBITDA and total debt outstanding—deleveraging velocity essential
- Free cash flow generation and retention to rebuild depleted equity base
- Current ratio and working capital trends—liquidity stress indicators
- Interest coverage
- Free cash flow margin
Rh (RH) Financial Metrics & Key Ratios
💡 AI Analyst Insight
The relatively thin 1.7% FCF margin may limit capital allocation flexibility.
RH Profit Margin, ROE & Profitability Analysis
RH vs Consumer Sector: How Rh Compares
How Rh compares to Consumer sector averages
Sector benchmarks are approximate industry averages. Actual sector performance may vary.
Is Rh Stock Overvalued? RH Valuation Analysis 2026
Based on fundamental analysis, Rh shows some fundamental concerns relative to the Consumer sector in 2026.
Note: This is a fundamental analysis based on SEC filings. For P/E ratio, price targets, and market-based valuation, consult financial data providers. This is not investment advice.
Rh Balance Sheet: RH Debt, Cash & Liquidity
RH Revenue & Earnings Growth: 5-Year Financial Trend
5-Year Trend Summary: Rh's revenue has grown significantly by 21% over the 5-year period, indicating strong business expansion. The most recent EPS of $5.91 reflects profitable operations.
RH Revenue Growth, EPS Growth & YoY Performance
RH Quarterly Earnings & Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q1 2026 | $800.3M | $8.0M | $0.40 |
| Q3 2025 | $811.7M | $33.2M | $1.66 |
| Q2 2025 | $829.7M | $25.3M | $1.27 |
| Q1 2025 | $727.0M | -$3.6M | $-0.20 |
| Q3 2024 | $751.2M | -$2.2M | $-0.12 |
| Q2 2024 | $800.5M | $25.3M | $1.27 |
| Q1 2024 | $727.0M | -$3.6M | $-0.20 |
| Q3 2023 | $751.2M | -$2.2M | $-0.12 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
Rh Dividends, Buybacks & Capital Allocation
RH SEC Filings: Latest 10-K & 10-Q Analysis
Access official SEC EDGAR filings for Rh (CIK: 0001528849)
📋 Recent SEC Filings
| Date | Form | Document | Action |
|---|---|---|---|
| Jun 25, 2026 | 8-K | rh-20260618x8k.htm | View → |
| Jun 22, 2026 | 4 | xslF345X06/form4-06222026_080601.xml | View → |
| Jun 18, 2026 | 4 | xslF345X06/form4-06182026_080610.xml | View → |
| Jun 18, 2026 | 4 | xslF345X06/form4-06182026_080608.xml | View → |
| Jun 18, 2026 | 4 | xslF345X06/form4-06182026_080606.xml | View → |
❓ Frequently Asked Questions about RH
What is the AI rating for RH?
Rh (RH) has a Combined AI Grade of C from Claude (D) and ChatGPT (B) with 80% combined confidence, based on fundamental analysis of SEC EDGAR filings.
What are RH's key strengths?
Claude: Revenue growing 8.1% YoY with 41.4% gross margin showing core business viability. Net income loss narrowing significantly (+72.3% YoY) trending toward breakeven. ChatGPT: High gross margin (44.1%) and solid operating margin (11.3%). Consistent free cash flow generation (7.3% FCF margin).
What are the risks of investing in RH?
Claude: Extreme leverage with debt-to-equity of 42.55x and stockholders equity only $56.9M. Interest coverage of 0.2x—company cannot cover interest expense from operating income, indicating debt service vulnerability. ChatGPT: Very high leverage with low interest coverage (2.2x) and minimal equity. Low cash balance versus long-term debt ($41M vs $2.42B).
What is RH's revenue and growth?
Rh reported revenue of $800.3M.
Does RH pay dividends?
Rh does not currently pay dividends.
Where can I find RH SEC filings?
Official SEC filings for Rh (CIK: 0001528849) including 10-K, 10-Q, and 8-K reports are available on SEC EDGAR.
What is RH's EPS?
Rh has a diluted EPS of $-0.73.
How is the AI analysis conducted?
Two independent AI systems — Claude (Anthropic) and ChatGPT (OpenAI) — analyze SEC EDGAR filings including 10-K annual reports and 10-Q quarterly reports. Each AI evaluates financial health, profitability ratios, balance sheet strength, and growth metrics. The combined grade reflects both perspectives for balanced insights.
What is RH's fundamental grade?
Based on our AI fundamental analysis in June 2026, Rh has a C grade with 80% confidence. Review the strengths and risks sections above for full context. This is not investment advice.
Is RH stock overvalued or undervalued?
Valuation metrics for RH: ROE of -24.1% (sector avg: 18%), net margin of -1.7% (sector avg: 8%). Compare these metrics with sector averages to assess valuation.
What is RH's AI grade for 2026?
Our dual AI analysis gives Rh a combined C grade for 2026. Revenue is data pending, with profitability at or below sector average. Always conduct your own research.
What is RH's free cash flow?
Rh's operating cash flow is $52.5M, with capital expenditures of $39.2M. FCF margin is 1.7%.
How does RH compare to other Consumer stocks?
Vs Consumer sector averages: Net margin -1.7% (avg: 8%), ROE -24.1% (avg: 18%), current ratio 1.13 (avg: 1.5).
Is Rh carrying too much debt?
RH has a debt-to-equity ratio of 42.55x, which is above the Consumer sector average of 0.8x. However, the current ratio of 1.13 suggests adequate short-term liquidity.