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Williams-Sonoma (WSM) Gains As Market Dips: What You Should Know

Williams-Sonoma (WSM) closed at $123.31 in the latest trading session, marking a +1.75% move from the prior day. This move outpaced the S&P 500's daily loss of 0.21%. Meanwhile, the Dow lost 0.43%, and the Nasdaq, a tech-heavy index, added 0.01%.

Prior to today's trading, shares of the seller of cookware and home furnishings had lost 21.85% over the past month. This has lagged the Retail-Wholesale sector's loss of 9.13% and the S&P 500's loss of 9.7% in that time.

Wall Street will be looking for positivity from Williams-Sonoma as it approaches its next earnings report date. In that report, analysts expect Williams-Sonoma to post earnings of $3.79 per share. This would mark year-over-year growth of 14.16%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $2.17 billion, up 6.06% from the year-ago period.

WSM's full-year Zacks Consensus Estimates are calling for earnings of $16.57 per share and revenue of $8.71 billion. These results would represent year-over-year changes of +11.58% and +5.68%, respectively.

Investors might also notice recent changes to analyst estimates for Williams-Sonoma. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.44% higher. Williams-Sonoma is currently a Zacks Rank #3 (Hold).

Digging into valuation, Williams-Sonoma currently has a Forward P/E ratio of 7.32. Its industry sports an average Forward P/E of 8.4, so we one might conclude that Williams-Sonoma is trading at a discount comparatively.

Investors should also note that WSM has a PEG ratio of 1.32 right now. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. WSM's industry had an average PEG ratio of 1.24 as of yesterday's close.

The Retail - Home Furnishings industry is part of the Retail-Wholesale sector. This industry currently has a Zacks Industry Rank of 169, which puts it in the bottom 33% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow WSM in the coming trading sessions, be sure to utilize Zacks.com.


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