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Why Williams-Sonoma (WSM) Dipped More Than Broader Market Today

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Williams-Sonoma (WSM - Free Report) closed at $163.62 in the latest trading session, marking a -4.01% move from the prior day. The stock fell short of the S&P 500, which registered a loss of 0.4% for the day. Elsewhere, the Dow saw a downswing of 0.98%, while the tech-heavy Nasdaq appreciated by 0.18%.

Heading into today, shares of the seller of cookware and home furnishings had gained 7.78% over the past month, outpacing the Retail-Wholesale sector's gain of 4.14% and the S&P 500's gain of 4.97%.

The investment community will be closely monitoring the performance of Williams-Sonoma in its forthcoming earnings report. The company is forecasted to report an EPS of $1.78, showcasing a 2.3% upward movement from the corresponding quarter of the prior year. In the meantime, our current consensus estimate forecasts the revenue to be $1.81 billion, indicating a 1.46% growth compared to the corresponding quarter of the prior year.

Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $8.53 per share and revenue of $7.72 billion, indicating changes of -2.96% and +0.14%, respectively, compared to the previous year.

Investors might also notice recent changes to analyst estimates for Williams-Sonoma. These latest adjustments often mirror the shifting dynamics of short-term business patterns. As such, positive estimate revisions reflect analyst optimism about the business and profitability.

Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. To take advantage of this, we've established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, there's been no change in the Zacks Consensus EPS estimate. Williams-Sonoma currently has a Zacks Rank of #3 (Hold).

Looking at its valuation, Williams-Sonoma is holding a Forward P/E ratio of 19.98. Its industry sports an average Forward P/E of 19.98, so one might conclude that Williams-Sonoma is trading at no noticeable deviation comparatively.

Meanwhile, WSM's PEG ratio is currently 2.76. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. As of the close of trade yesterday, the Retail - Home Furnishings industry held an average PEG ratio of 2.33.

The Retail - Home Furnishings industry is part of the Retail-Wholesale sector. With its current Zacks Industry Rank of 94, this industry ranks in the top 39% of all industries, numbering over 250.

The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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