Is it Still Safe to Invest in RH?

Polen Capital, an investment management firm, published its “Polen US SMID Company Growth Fund” first quarter 2022 investor letter – a copy of which can be downloaded here. Over the first quarter, the Polen U.S. SMID Company Growth Composite Portfolio (the “Portfolio”) returned -23.81% gross and -24.02% net of fees, respectively, underperforming the Russell 2500 Growth Index’s -12.30% return.  Try to spend some time looking at the fund’s top 5 holdings to be informed about their best picks for 2022. 

In its Q1 2022 investor letter, Polen US SMID Company Growth Fund mentioned RH (NYSE:RH) and explained its insights for the company. Founded in 2011, RH (NYSE:RH) is a Corte Madera, California-based luxury furniture company with a $7.4 billion market capitalization. RH (NYSE:RH) delivered a -43.32% return since the beginning of the year, while its 12-month returns are down by -50.46%. The stock closed at $301.94 per share on June 02, 2022.

Here is what Polen US SMID Company Growth Fund has to say about RH (NYSE:RH) in its Q1 2022 investor letter:

“RH is a furniture store company with brand recognition and a unique business model. The company’s stock price fell sharply over the first three months of 2022 despite solid operating results, which resulted in what we believed to be an attractive opportunity to add to our position in the company. We are mindful that, on the margin, the company is certainly experiencing some early impact from record inflation and rising interest rates, and we feel comfortable in both the management team’s ability to navigate these challenges and the power of the company’s brand and its long-term potential.”

Marko Poplasen/Shutterstock.com

Our calculations show that RH (NYSE:RH) fell short and didn’t make it on our list of the 30 Most Popular Stocks Among Hedge Funds. RH (NYSE:RH) was in 63 hedge fund portfolios at the end of the first quarter of 2022, compared to 58 funds in the previous quarter. RH (NYSE:RH) delivered a -17.13% return in the past 3 months. You can find other investor letters from hedge funds and prominent investors on our hedge fund investor letters 2022 Q1 page.

Disclosure: None. This article is originally published at Insider Monkey.