12:59 PM EDT, 10/21/2024 (MT Newswires) -- RH's (RH) new products are likely to drive upside to forecasts in H2 2024 and the next two years, Wedbush Securities said in a note Monday.

"RH's new products capitalize on major design trends such as reeded furniture and motion furniture, its development prowess enables it to commercialize complete collections to dominate the trend, and its scale enables it to negotiate the lowest cost (for a given quality)," the firm said.

Wedbush said a "robust" pipeline of marquee new galleries is also likely to drive upside, adding that it now estimates sales growth contributions from new stores to accelerate between 3% and 5% in 2025 and 2026, in addition to "store maturation benefits" to sales growth potentially exceeding 10% by late 2026.

"RH is now our preferred name in home furnishings retail," the firm said as it upgraded the company to outperform from neutral and boosted its price target to $430 from $310.

RH shares were down 1.8% in recent Monday trading.

Price: 347.97, Change: -6.55, Percent Change: -1.85