Williams-Sonoma Inc. Earnings Cheat Sheet: Company Enjoys Fifth Straight Quarter of Double-Digit Growth

The Cheat Sheet

Williams-Sonoma Inc. reported net income above Wall Street’s expectations for the third quarter. Williams-Sonoma is a retailer of products for the home. The retail segment of its business sells products through five retail store concepts: Williams-Sonoma, Pottery Barn, Pottery Barn Kids, West Elm and Williams-Sonoma Home.

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Williams-Sonoma Earnings Cheat Sheet for the Third Quarter

Results: Net income for Williams-Sonoma Inc. rose to $43.4 million (41 cents per share) vs. $36.5 million (34 cents per share) in the same quarter a year earlier. This marks a rise of 18.8% from the year earlier quarter.

Revenue: Rose 6.3% to $867.2 million from the year earlier quarter.

Actual vs. Wall St. Expectations: WSM beat the mean analyst estimate of 38 cents per share. Analysts were expecting revenue of $856.2 million.

Quoting Management: Laura Alber, President and Chief Executive Officer, commented, “The third quarter was another strong quarter for the company as comparable brand revenues increased 7% and non-GAAP diluted earnings per share increased 17% to a Q3 record of $0.41 per share. Innovative merchandising, personalized and event-triggered marketing, and a higher level of customer engagement drove these better-than-expected results as we continued to attract new customers to our brands. Non-GAAP operating margin increased 60 basis points to a Q3 record of 7.9%, while we continued to invest in our e-commerce, global expansion and business development initiatives.”

Key Stats:

The company has now seen net income rise in three straight quarters. In the second quarter, net income rose 27.8% and in the first quarter, the figure rose 61.8%.

The company has now topped analyst estimates for the last four quarters. It beat the mark by one cent in the second quarter, by 2 cents in the first quarter, and by 10 cents in the fourth quarter of the last fiscal year.

Revenue has risen the past four quarters. Revenue increased 5.1% to $814.8 million in the second quarter. The figure rose 7.4% in the first quarter from the year earlier and climbed 9.7% in the fourth quarter of the last fiscal year from the year-ago quarter.

Looking Forward: Over the last 30 days, analysts have not been optimistic about the company’s next quarter performance. The average estimate for the fourth quarter is now $1.17 per share, down from $1.18. At $2.22 per share, the average estimate for the fiscal year has risen over the past seven days from $2.21.

Competitors to Watch:  Bed Bath & Beyond Inc. , Pier one Imports, Inc. , Kirkland’s, Inc. , Cost Plus, Inc. , Haverty Furniture Companies, Inc. , Italtile Limited , Macy’s and Nordstrom’s .

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(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

 

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