03:32 PM EDT, 09/06/2024 (MT Newswires) -- RH's (RH) has shown some improvement in terms of demand in Q2, but is unlikely to meet its existing outlook, UBS Securities said in a note emailed Friday.

"In this case, the company is likely to lower its prior guidance that called for a significant inflection in its business in the back half of this year," UBS said.The market is looking at potential earnings per share growth for 2025 and 2026, but these gains might start from a lower base and continued use of promotions could affect long-term margins.

Industry trends suggest weak demand, with peers like Williams-Sonoma's ( WSM ) and Wayfair ( W ) lowering forecasts, "this suggests RH may need to push out its expectation for a meaningful revenue inflection yet again," UBS said.

UBS has neutral rating on RH and maintained its price target of $280, based on a lower multiple reflecting a more normalized market scenario.

Price: 250.43, Change: +0.60, Percent Change: +0.24