Williams-Sonoma NYSE: WSM Offers everything an investor could want and more, making it a worthy stock Buy and keep the situation Its quality is focused on the brand and operations, which CEO Laura Alber stewards. Results of his tenure include growth, operational improvements, market share gains, growth Brand loyaltyAnd allows continuous reinvestment in the business while maintaining strong cash flow, a fortress balance sheet and a healthy capital return.
In terms of capital returns, the payout from Williams-Sonoma is as good as it gets, including an attractive dividend and count-reducing share buybacks.
in between FQ3 Earnings Report Highlights are the $5 billion increase in existing certification, which is worth about 30% of the pre-release market cap and is significant in market response. The market has surged more than 20% to near-record highs and will likely trend higher in the year ahead. Other highlights include a notable mention of revenue and earnings trends and increased guidance, likely to be cautious given the trends.
Williams-Sonoma stock forecast today
$154.41
-10.24% downsidecatch up
Based on 18 analyst ratings
| High forecast | $195.00 |
|---|---|
| Average forecast | $154.41 |
| Less predictable | $77.00 |
Williams-Sonoma beat-and-rise quarter, Widnes margin
Williams-Sonoma had a solid quarter, reflecting the resilience of its consumer base and the impact of Ms. Elber’s work over the past few years. The company’s revenue is contracting on lower compacts due to headwinds and the post-Covid slowdown. Still, $1.8 billion was down just 2.7% and ahead of the consensus estimate reported by Marketbeat. Segmentally, most segments had lower revenues, with Pottery Barn leading the way at 7.5%. West Elm fell 3.5%, and the core Williams-Sonoma brand just 0.1%. Pottery Barn Kids, a source of continued strength, rose 3.8%.
Williams-Sonoma Dividend Payments
- Dividend yield
- 1.33%
- Annual dividend
- $2.28
- Track record of dividend growth
- 19 years
- Annual 3-year dividend growth
- 20.88%
- Dividend payout ratio
- 26.97%
- Recent dividend payments
- November 22
Margin news is even better. The company increased its gross margin on cost recovery, lower cost of goods sold, and operational improvements. Commercial margin improved by 130 bps, and supply chain improved by 100, leading to a 230-basis increase in gross margin. Increased SG&A offset the gain to a degree, but not entirely. Operating margin increased by 80 basis points to 17.8%, above the high end of the long-term target range. The critical detail is that adjusted EPS of $1.96 beat the consensus by $0.19 or about 1100 basis points and increased 7.1% compared to top-line contraction.
Guidance is the icing on the investment cake. The company raised its revenue and margin guidance for the year due to revenue and margin trends. The company expects revenue to contract by just 3% to 1.5%, the lower end of the range by 100 bps and for margins of 17.8% to 18.2%, up 40 basis points from previous guidance.
Williams-Sonoma has cash flow and a balance sheet to envy
Williams-Sonoma has Cash flow and a balance sheet Any company would be jealous. Quarterly and YTD cash flow allowed the company to increase its cash position compared to last year, returning more than $600 million to investors. Capital returns included $73 million in dividends and $533 million in buybacks, reducing the number by 2% for the quarter.
The pace of buybacks is expected to continue strongly as the year progresses, and into 2025, nothing on the balance sheet suggests otherwise. Details show increases in cash, inventory, current, and total assets, liabilities and debt relatively flat, low leverage with total liabilities about 1.6x equity and equity growing. Shareholder’s equity increased by 5%.
Price action in WSM stock is strong in the pre-market session following the earnings release. The market is up more than 20%, showing strong support below a trading range and potential to set new highs.
Critical resistance is near $175 and will likely be broken soon. A move above $175 would signal a continuation of the trend that started in 2023 and would likely take the market to the $200 level, as Illustrated by technical estimates.
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