Telsey raises Arhaus stock price target to $12 on brand awareness

Published 07/08/2025, 22:16
Telsey raises Arhaus stock price target to $12 on brand awareness

Investing.com - Telsey Advisory Group raised its price target on Arhaus Inc (NASDAQ:ARHS) to $12.00 from $10.00 on Thursday, while maintaining a Market Perform rating on the home furnishings retailer. The stock has shown strong momentum recently, gaining over 12% in the past week, according to InvestingPro data.

The research firm cited Arhaus’s differentiated product assortment and showroom experience as key strengths, noting the company is benefiting from higher brand awareness following a 30% increase in its showroom count over the past three years. The strategy appears to be paying off, with the company maintaining a healthy 45.5% gross profit margin.

Telsey highlighted Arhaus’s strong financial position, with $235 million in cash and no debt at the end of the second quarter of 2025, positioning the company well to gain market share when housing demand improves. InvestingPro analysis shows the company maintains a solid current ratio of 1.26 and has achieved profitability over the last twelve months.

The firm’s revised price target is based on applying an EV/EBITDA multiple of approximately 10x to its updated 2026 EBITDA estimate of $154 million, which was increased from $150 million previously.

Despite the positive long-term outlook, Telsey expressed near-term concerns about volatility in month-to-month demand and the company’s use of promotions to drive sales, along with ongoing investments in systems and operations that, combined with incremental tariff costs, could limit margin expansion until growth accelerates.

In other recent news, Arhaus Inc reported strong financial results for the second quarter of 2025, significantly exceeding market expectations. The company achieved an earnings per share (EPS) of $0.28, which was notably higher than the projected $0.15, resulting in an 86.67% surprise. Revenue figures were also impressive, with Arhaus generating $358 million, surpassing the anticipated $333.46 million. These results highlight the company’s robust performance and have garnered attention from investors. Additionally, the financial community has shown interest in Arhaus’s recent developments, with analysts from various firms closely monitoring the company’s progress. These recent results underscore Arhaus’s ability to outperform forecasts, contributing to a positive outlook among investors and analysts alike.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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