Cowen Trims PT on Restoration Hardware (RH) Following Q3 Results But Says Weakness Overdone

Cowen maintained an Outperform rating on Restoration Hardware (NYSE: RH), and cut the price target to $105.00 (from $112.00), following the company's 3Q earnings report. The +3c EPS beat was driven solely by lower SG&A. Despite the concerns, Cowen is still encouraged that 4Q QTD revenue growth is tracking ahead of plan and the key factors for the long-term are exceeding expectations.

Analyst Oliver Chen commented, "We're encouraged by 4Q rev. guide +21-23% y/y above Street's prior +20% y/y as Modern/Teen adding incremental rev. & new galleries exceeding expectations. We acknowledge near-term investor focus could be on weaker GM, but we believe stock weakness overblown as comps improve sequentially in 4Q. Reit. Outperform, but lower PT to $105 (was $112) on ~27x '16E EPS."

For an analyst ratings summary and ratings history on Restoration Hardware click here. For more ratings news on Restoration Hardware click here.

Shares of Restoration Hardware closed at $87.59 yesterday.

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