On April 2, I published an article, titled “Time to Change My Mind About Restoration Hardware.”
If you acted on this advice, you’re a lot richer today.
Here’s a quick review…
In April, I noticed that Restoration Hardware (NYSE: RH) shares were falling on earnings – and reported:
Last week, shares of the company fell more than $28 after 2019 earnings guidance came in just under $9, against the expectation of $10. Its stock dropped 20% on the news, and management blamed “negative trends in the high-end housing market.”
In response to this drop, I said…
Wall Street (on occasion) tends to overreact. This might be one of those times, and it allows us to get in on a strong stock for a far better price than before… I view this as a second chance to correct my thinking and a second opportunity to get into Restoration Hardware.
On that day, the action plan was simple. I said…
If we can see some stabilization in Restoration Hardware stock, a possible move above $105 might be where I’d start dipping a toe into the water. This earnings overreaction gap has quite a lot of room to fill.
Here’s what the Restoration Hardware chart looked like when this alert was posted:
Fast-forward to today…
It was just reported that Warren Buffett – and Berkshire Hathaway – revealed a new investment stake in Restoration Hardware of 1.2 million shares as of the end of Q3.
This investment makes them the fourth largest shareholder in the hardware company – but it’s still considered “small” for Berkshire Hathaway.
So there still could be more to come. On this news, shares of Restoration Hardware are exploding.
Here’s the chart…