Restoration Hardware (RH), the luxury furniture retailer, saw its stock surge 5.30% in pre-market trading on Tuesday, building on the momentum from Monday's impressive 12.92% gain. This continued upward trend suggests investors remain bullish on the company's prospects following recent positive developments.

Monday's rally was fueled by several factors that appear to be carrying over into Tuesday's pre-market activity. Stifel analysts reaffirmed their "buy" rating on RH stock, despite lowering their price target from $450 to $390. This vote of confidence from Wall Street, even with the adjusted target, seems to be resonating with investors.

Additionally, RH's outlook has brightened following a productive call between former President Donald Trump and Vietnam's Communist Party General Secretary, To Lam. The company sources a significant portion of its supplies from Vietnam, and the potential for reduced tariffs in a future US-Vietnam trade agreement could significantly boost RH's profit margins. The company has already successfully shifted much of its production from China to Vietnam, achieving better than pre-tariff pricing, which positions it well for potential trade benefits.

As global trade tensions continue to impact markets, RH's strategic sourcing decisions and potential to benefit from improved US-Vietnam relations appear to be setting it apart from competitors. Investors seem to be betting on RH's ability to navigate these challenges and potentially emerge stronger, driving the stock's pre-market surge as trading resumes after Monday's strong performance.