MeritValue

Arhaus, Inc.

ARHSdata completeness 88%7 fiscal years on file

Data notes: no data for concept 'totalDebt'

The thesis, from the filings

Arhaus, Inc. earns about 103% on invested capital, far above its ~9% cost of capital, but has diluted owners by 18% over 5 years — a real edge showing up in the numbers. The estimate methods put fair value between $5.02 and $7.75 a share.Whether it’s worth owning at today’s price is the last question — and yours to answer, below.

i. The business — what you’d actually own
FigureFY 2021FY 2022FY 2023FY 2024FY 2025
Revenue$796.9M1$1.23B2$1.29B3$1.27B3$1.38B3
Net income$21.1M4$136.6M5$125.2M6$68.6M6$67.3M6
Operating cash flow$139.8M7$77.5M8$168.7M9$147.1M9$136.8M9
Capital expenditure$41.5M10$55.7M11$93.4M12$107.4M12$77.9M12
Free cash flow (derived)$98.4M7$21.8M8$75.2M9$39.7M9$59M9
Total debt—————
Cash & equivalents$123.8M13$145.2M14$223.1M15$197.5M16$253.4M16
Diluted shares119.5M139.6M140.1M140.7M141.4M

Superscripts are receipts. Each links to the SEC filing the number came from (full list at the bottom).

ii. Your slice — ownership made literal
If you owned
shares
Net assets behind them
$29.58
your share of equity
Profit it earned you last year
$4.76
Free cash flow it threw off
$4.17
Debt you’d be carrying
—

10 shares is a claim on $29.58 of net worth that earned you $4.76 and generated $4.17 of cash last year.

iii. Is this a good business?
Moat signal · return on invested capital
103% avg · 5y
FY21 —FY22 216%FY23 109%FY24 47%FY25 41%

It earned about 103% on invested capital, year after year, against a ~9% cost of capital — the footprint of real pricing power. Competition usually drags returns like this back down; here it hasn't.

seeing a moat in the numbers →
Management signal · capital allocation
+18% shares · 5y

Share count is up 18% over 5 years — owners have been diluted. Worth asking what they got for it.

reading capital allocation →

Signals, not verdicts — read from the filings above. Numbers don’t prove a moat; they show its footprint. You decide.

iv. What it’s worth — engine v0.1.0

The 3 estimate methods that apply put fair value between $5.02 and $7.75 a share. They rest on different assumptions, so where they diverge is the story; the Graham Number is a stricter floor, not a target.

DCF · Growth Exit 10Y
$7.3
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears10
  • fcfGrowth0.0%
  • fcfBase$59M
DCF · Growth Exit 5Y
$7.75
assumptions (10)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • terminalGrowth2.5%
  • projectionYears5
  • fcfGrowth0.0%
  • fcfBase$59M
Earnings Power Value
$5.02
assumptions (8)
  • riskFreeRate4.7%
  • equityRiskPremium5.0%
  • beta100.0%
  • equityWeight85.0%
  • costOfDebtSpread1.5%
  • taxRate21.0%
  • normalizedEarnings$68.6M
  • growthAssumed0.0%
Graham Number
$5.65
assumptions (1)
  • grahamMultiplier2250.0%

Different models answer different questions — which to trust when →

v. The price question — last, on purpose
Is today’s price fair?
See live price ↗
Type a price. The ledger answers.
Or set your own belief
FCF growth, next 5 years0.0%
Discount rate (WACC)8.93%
Terminal growth2.5%
At your growth, a share is worth $7.75
The three cases
Bear0.0%$7.75
Base0.0%$7.75
Bull5.0%$9.19

Bear/base/bull growth = 0% / filed history / history + 5pp. Type a price to see the return each case implies.

Default growth 0.0%= this company’s own filed history (median-to-median FCF CAGR, clamped 0–20%). Your adjustments are recorded anonymously. They become the “what do owners actually believe” dataset.

Sources — the receipts
  1. 10-K · period ending 2021-12-31 · accession 0001875444-24-000024 (RevenueFromContractWithCustomerExcludingAssessedTax)
  2. 10-K · period ending 2022-12-31 · accession 0001875444-25-000021 (RevenueFromContractWithCustomerExcludingAssessedTax)
  3. 10-K · period ending 2023-12-31 · accession 0001875444-26-000010 (RevenueFromContractWithCustomerExcludingAssessedTax)
  4. 10-K · period ending 2021-12-31 · accession 0001875444-23-000018 (NetIncomeLoss)
  5. 10-K · period ending 2022-12-31 · accession 0001875444-25-000021 (NetIncomeLoss)
  6. 10-K · period ending 2023-12-31 · accession 0001875444-26-000010 (NetIncomeLoss)
  7. 10-K · period ending 2021-12-31 · accession 0001875444-24-000024 (NetCashProvidedByUsedInOperatingActivities)
  8. 10-K · period ending 2022-12-31 · accession 0001875444-25-000021 (NetCashProvidedByUsedInOperatingActivities)
  9. 10-K · period ending 2023-12-31 · accession 0001875444-26-000010 (NetCashProvidedByUsedInOperatingActivities)
  10. 10-K · period ending 2021-12-31 · accession 0001875444-24-000024 (PaymentsToAcquirePropertyPlantAndEquipment)
  11. 10-K · period ending 2022-12-31 · accession 0001875444-25-000021 (PaymentsToAcquirePropertyPlantAndEquipment)
  12. 10-K · period ending 2023-12-31 · accession 0001875444-26-000010 (PaymentsToAcquirePropertyPlantAndEquipment)
  13. 10-K · period ending 2021-12-31 · accession 0001875444-23-000018 (CashAndCashEquivalentsAtCarryingValue)
  14. 10-K · period ending 2022-12-31 · accession 0001875444-24-000024 (CashAndCashEquivalentsAtCarryingValue)
  15. 10-K · period ending 2023-12-31 · accession 0001875444-25-000021 (CashAndCashEquivalentsAtCarryingValue)
  16. 10-K · period ending 2024-12-31 · accession 0001875444-26-000010 (CashAndCashEquivalentsAtCarryingValue)