How Much Upside Could be Left in Williams-Sonoma Stock?



Stock performance

As of June 15, Williams-Sonoma (WSM) was trading at $62.31, which represents a 20.5% rise since the announcement of its first-quarter earnings on May 23. In the quarter, Williams-Sonoma posted EPS of $0.67 on revenue of $1.20 billion, while analysts were expecting the company to post EPS of $0.58 on revenue of $1.16 billion. After its strong first quarter, the company raised its revenue and EPS guidance for 2018, boosting investors’ confidence and its stock price. For a more detailed analysis of Williams-Sonoma’s first-quarter earnings, read Williams-Sonoma Raises Guidance on Strong First-Quarter Earnings.

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Year-to-date performance

Williams-Sonoma returned 6.8% in 2017, and has continued that momentum by rising 26.7% so far this year. In comparison, peers Bed Bath & Beyond (BBBY) and RH (RH) have returned -8.2% and 86.6%, year-to-date, and the broader comparative S&P 500 (SPX) and the SPDR S&P Homebuilders ETF (XHB) have returned 4.0% and -7.6%. Approximately 26% of XHB comprises home improvement and furnishing company stocks.

Series overview

In this series, we’ll look at analysts’ revenue and EPS estimates for Williams-Sonoma over the next four quarters, as well as the company’s guidance and valuation. Let’s start by looking at analysts’ revenue estimates.


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