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Williams-Sonoma (WSM) Sees a More Significant Dip Than Broader Market: Some Facts to Know

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Williams-Sonoma (WSM - Free Report) closed the most recent trading day at $181.45, moving -4.14% from the previous trading session. The stock fell short of the S&P 500, which registered a loss of 2.71% for the day. Elsewhere, the Dow lost 1.9%, while the tech-heavy Nasdaq lost 3.56%.

The seller of cookware and home furnishings's shares have seen a decrease of 6.99% over the last month, not keeping up with the Retail-Wholesale sector's loss of 4.01% and the S&P 500's gain of 3.5%.

The investment community will be paying close attention to the earnings performance of Williams-Sonoma in its upcoming release. The company is expected to report EPS of $1.87, down 4.59% from the prior-year quarter. Meanwhile, the latest consensus estimate predicts the revenue to be $1.85 billion, indicating a 2.84% increase compared to the same quarter of the previous year.

Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $8.55 per share and revenue of $7.82 billion, indicating changes of -2.73% and +1.38%, respectively, compared to the previous year.

Investors should also take note of any recent adjustments to analyst estimates for Williams-Sonoma. These revisions typically reflect the latest short-term business trends, which can change frequently. Therefore, positive revisions in estimates convey analysts' confidence in the business performance and profit potential.

Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

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. The Zacks Consensus EPS estimate has moved 0.19% lower within the past month. At present, Williams-Sonoma boasts a Zacks Rank of #3 (Hold).

Looking at valuation, Williams-Sonoma is presently trading at a Forward P/E ratio of 22.13. This signifies no noticeable deviation in comparison to the average Forward P/E of 22.13 for its industry.

Investors should also note that WSM has a PEG ratio of 3.05 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. The Retail - Home Furnishings was holding an average PEG ratio of 2.57 at yesterday's closing price.

The Retail - Home Furnishings industry is part of the Retail-Wholesale sector. At present, this industry carries a Zacks Industry Rank of 203, placing it within the bottom 18% of over 250 industries.

The Zacks Industry Rank is ordered from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.


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