Why Josh Brown Just Doubled Down On This Warren Buffett-Backed Stock

Ritholtz Wealth Management's Josh Brown doubled his position in Restoration Hardware RH Tuesday morning with the stock down more than 50% from its high.

"It's come down substantially because of inflation and all the issues in the housing market ... I just think it's gotten to the point where it's come down too much," Brown said Tuesday on CNBC's "Fast Money Halftime Report."

There was an overhang in the stock related to stock options that were issued to management during the IPO, but that overhang has been removed and the company has been cleared to start its previously announced buyback, according to Brown.

See Also: What 11 Analyst Ratings Have To Say About RH

Even if the company is unable to meet expectations, he still thinks the stock is too cheap, highlighting the fundamentals.

According to data from Benzinga Pro, RH is trading around 13 times forward earnings and 2.75 times sales. The company currently has a market cap of around $7.18 billion.

"This is one of Berkshire Hathaway's favorite stocks, they've been buying it," Brown said. "And I think because [RH] caters to the ultra-luxury high end segment of the market, regardless of the overall economy, this company should do just fine so I like it here."

RH Price Action: RH shares have traded between $317 and $744.56 over a 52-week period.

The stock was up 7.81% at $356.70 at time of publication.

Photo: justinedgecreative from Pixabay.