RH

M

mr_byte31

I was waiting for the Q2 report of RH.
it is really a nice stock with nice jumps.
chart.ashx

Yesterday was the Q2 report announcement AMC.

Q2 : https://www.sec.gov/Archives/edgar/data/1528849/000156459018022614/rh-ex991_6.htm

The basic net income per share for Q2 : $2.92[Q2 2018] and $-0.28[Q2 2017]

the surprise was good :
upload_2018-9-5_12-29-46.png


I can see the pre-market price is really down !
upload_2018-9-5_12-30-19.png



Oh God. I don't understand why the market behave like this !!!
does anybody know why when good earnings happen, prices starts to get down ?!

I was captured in the same situation for Intel, MU, NVDA ,RHT , AVGO .. . they reported really good earnings and price went down some of them recovered , the others not !
 
Raising Fiscal 2018 Earnings Guidance and Increasing Long-Term Targets

As a result of our strong second quarter earnings, we are raising our fiscal 2018 adjusted diluted earnings per share guidance for a third time. We are now expecting adjusted diluted earnings per share for the year to be in the range of $7.35 to $7.75 up 15% from our previous guidance of $6.34 to $6.83, while slightly lowering revenue guidance by approximately 2% as we continue to prioritize earnings over revenue growth and focus on optimizing the profitability of our new operating model.

As part of raising our full year guidance, we are also raising our third and fourth quarter adjusted diluted earnings per share guidance. We are now expecting adjusted diluted earnings per share for the third quarter to be in the range of $1.15 to $1.33, up from $1.04 to $1.23, and adjusted diluted earnings per share for the fourth quarter to be in the range of $2.33 to $2.54, up from $2.16 to $2.39.
More...
Doesn't sound bad !
More and more earnings and very small revenue !
wouldn't earnings be much better than the revenue ?
 
mr_byte31 said:
Doesn't sound bad !
More and more earnings and very small revenue !
wouldn't earnings be much better than the revenue ?
More...

More and more adjusted earnings. It could be the adjustments.

The stock rallied on the report but sold off on conference call. I would read the call transcript.

And 5percent for this name is essentially flat.
 
mr_byte31 said:
Doesn't sound bad !
More and more earnings and very small revenue !
wouldn't earnings be much better than the revenue ?
More...

News 16:15 EDT RH reports Q2 adj. EPS $2.49, consensus $1.75
- Reports Q2 revenue $640.8M, consensus $660.89M. Comparable brand revenues
increased 5% in Q2. Adjusted diluted earnings per share includes a 44c per
share net benefit comprised of a 51c tax benefit from associate option
exercises following the sharp increase ... Lowers FY18 revenue view to down 2% from $2.53B-$2.57B, consensus $2.56B.

Nope earnings are not more important than revenues. Earnings are easily manipulated, such as moving expenses from one quarter to another. Revenues are much harder to manipulate.
Not only did RH not meet revenue expectations, it lowered its Fiscal Year revenue projections. A bad sign.
Also you will notice that 0.51 of the $2.49 EPS was a one time adjustment.
 
Your analysis seems very logical.
but this statement :
Also you will notice that 0.51 of the $2.49 EPS was a one time adjustment.
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I didn't understand it.
could you elaborate more ? what does one time adjustment mean.
I came across this word several times and didn't get it
 
mr_byte31 said:
... could you elaborate more ? what does one time adjustment mean.
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A change to the earnings that is a one time event, and will not affect future earnings. Examples, payments for a big lawsuit, a sale of an asset, a tax accounting change.
 
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