A Goodwill is an intangible asset that arises as a result of the acquisition of one company by another for a premium value. The value of a company's brand name, solid customer base, good customer relations, good employee relations and any patents or proprietary technology represent goodwill. RH's goodwill for the quarter that ended in Jan. 2024 was $141 Mil.
RH Goodwill Historical Data
The historical data trend for RH's Goodwill can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
A Goodwill is an intangible asset that arises as a result of the acquisition of one company by another for a premium value. The value of a company's brand name, solid customer base, good customer relations, good employee relations and any patents or proprietary technology represent goodwill. Goodwill is considered an intangible asset because it is not a physical asset like buildings or equipment. The goodwill account can be found in the assets portion of a company's balance sheet.
RH (NYSE:RH) Goodwill Explanation
Goodwill to Asset ratio measures how much goodwill a company is recording compared to the total level of its assets.
It is calculated by dividing goodwill by total assets.
RH's Goodwill-to-Asset Ratio for the fiscal year that ended in Jan. 2024 is calculated as
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
If the goodwill-to-asset ratio increases, it can mean that the company is recording a proportionately higher amount of goodwill, assuming total assets are remaining constant. It is generally good to see a company increasing its assets regularly; however, if these increases are coming from intangible assets, such as goodwill, the increases may not be as good.
Increases in the goodwill-to-asset ratio might suggest that a company has been aggressively acquiring other firms or has seen its tangible assets decrease in value. When a large portion of total assets are attributable to intangible assets (such as goodwill), the company may be at risk of having that portion of its asset base wiped out quickly if it must record any goodwill impairments. Decreases in the goodwill-to-assets ratio suggest that the company has either written down some goodwill or increased its tangible assets.
Asset needs vary from industry to industry. This is why comparing goodwill-to-assets ratios is generally most meaningful among companies within the same industry. By comparing a company's goodwill to assets ratio to those of other companies within the same industry, investors can get a feel for how a company is managing its goodwill.
RH Goodwill Related Terms
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RH is a luxury retailer operating in the $143 billion domestic furniture and home furnishing industry. The firm offers merchandise across many categories including furniture, lighting, textiles, bath, decor, children, and is growing the presence of its hospitality business (with 15 restaurant locations). RH innovates, curates, and integrates products, categories, services, and businesses across channels and brand extensions (RH Teen, RH Modern, and Waterworks, for example). RH is fully integrated across store, Web, and catalog channels, and is positioned to broaden its total addressable market over the next decade with its World of RH digital platform (highlighting offerings outside of home furnishings), along with future offerings in color, bespoke furniture, architeture, media, and more.
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