Why Shares of RH Soared in September
Shares of RH (NYSE: RH) soared 15.8% in September according to data provided by S&P Global Market Intelligence. The luxury home furnishings retailer is better known by its former name, Restoration Hardware. But the name isn't the only thing that's different about the company. Its margins have been changing, too -- for the better.
The key driver of last month's strong share price performance was RH's impressive set of second-quarter earnings. While sales of $709 million in the quarter were basically flat compared to the same period last year, gross profit margin improved from 41.7% to 46.9%, and operating income margin improved from 14.7% to 19.3%. The end result was a whopping 31% year-over-year increase in operating income in the quarter.
U.S. homeowners have been spending money on furnishings. Image source: Getty Images
Source Fool.com
