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Williams-Sonoma (WSM) Outpaces Stock Market Gains: What You Should Know

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Williams-Sonoma (WSM) closed the most recent trading day at $164.10, moving +1.3% from the previous trading session. This move outpaced the S&P 500's daily gain of 0.84%. At the same time, the Dow added 1.06%, and the tech-heavy Nasdaq gained 0.1%.

Coming into today, shares of the seller of cookware and home furnishings had gained 6.64% in the past month. In that same time, the Retail-Wholesale sector lost 5.57%, while the S&P 500 lost 4.03%.

Williams-Sonoma will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $4.82, up 22.03% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $2.57 billion, up 11.89% from the year-ago period.

Investors should also note any recent changes to analyst estimates for Williams-Sonoma. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.28% higher. Williams-Sonoma is currently sporting a Zacks Rank of #3 (Hold).

In terms of valuation, Williams-Sonoma is currently trading at a Forward P/E ratio of 11.29. Its industry sports an average Forward P/E of 11.98, so we one might conclude that Williams-Sonoma is trading at a discount comparatively.

Also, we should mention that WSM has a PEG ratio of 1.25. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. Retail - Home Furnishings stocks are, on average, holding a PEG ratio of 0.81 based on yesterday's closing prices.

The Retail - Home Furnishings industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 32, putting it in the top 13% 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.

Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.


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