Arhaus Expected to Outperform Peers in Long Run, Says Bank of America Analyst

Bank of America's Curtis Nagle raised their price target on Arhaus (NASDAQ: ARHS) by 7.4% from $13.5 to $14.5 on 2024/03/05. The analyst maintained their Strong Buy rating on the stock.

According to Nagle, online furnishings spending continues to outpace other segments in the broader furniture category. Nagle's price target adjustment is supported by their firm's card data, which suggests that Arhaus, an online and retail seller of home furnishings, has consistently outperformed high-end furnishings retailers in terms of web traffic. Nagle predicts that Arhaus, still in its early growth stages, will continue to outperform its peers in the long run.

The current analyst consensus on Arhaus is overwhelmingly positive, with 100% of top-rated analysts rating the stock as a Strong Buy or Buy. Not a single analyst rates it as a Hold, and there are no recommendations to sell the stock.

Looking ahead, analysts forecast that Arhaus will deliver earnings per share (EPS) of $1.03 in the upcoming year. This represents a modest 1% increase on a year-over-year basis. While the growth rate may not be substantial, it aligns with the positive outlook maintained by the analyst community.

In terms of stock performance, Arhaus has seen a significant increase since its last quarterly report on September 30, 2023. The stock price is currently up 39% from that point. However, when comparing year-over-year, Arhaus is down 2.8%. During this period, Arhaus has underperformed the overall market, as the S&P 500 experienced a decline of 25.4%.

Curtis Nagle, the Bank of America analyst behind the recent rating update, has an impressive track record. Ranked in the top 15% of Wall Street analysts by WallStreetZen, Nagle boasts an average return of 15.3% and a win rate of 46.8%. Specializing in the Consumer Cyclical and Technology sectors, among others, Nagle's insights carry weight within the financial industry.

Arhaus Inc., the subject of Nagle's analysis, is a company that sells home furnishings both online and through retail stores and catalogs. With offerings ranging from sofas and dining tables to bedroom furniture and bedding, Arhaus caters to a wide range of customers. The company distinguishes itself by not sourcing materials from endangered rainforests and incorporating recycled materials in around 50% of its products. Additionally, Arhaus offers "relics," which are antiques purchased by the company and refurbished or repurposed. The company is headquartered in Boston Heights, OH.

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