In a report released today, Steven Zaccone from Citi maintained a Hold rating on Williams-Sonoma (WSM – Research Report), with a price target of $162.00.
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Steven Zaccone has given his Hold rating due to a combination of factors influencing Williams-Sonoma’s current market position. Despite the challenges posed by tariffs and a stagnant housing market, the company remains confident in its growth strategy. CEO Laura Alber emphasized that the company’s growth story is intact, focusing on initiatives within core brands, emerging brands, and scaling their B2B operations. This confidence is bolstered by the belief that their customer base is responding positively to new fashion trends and a shift in spending towards furniture.
Additionally, Zaccone notes that while the competitive environment has seen increased promotional activity due to tariff impacts, Williams-Sonoma is not overly concerned about pricing threats. The company’s vertically integrated supply chain allows it to adapt swiftly to tariff changes. Furthermore, there is an opportunity for market share gains from smaller independent businesses, as only a small percentage of home furnishings sales are currently online. Despite these positive aspects, the expected share price return of 2.4% suggests limited upside potential, justifying the Hold rating.
In another report released today, Morgan Stanley also maintained a Hold rating on the stock with a $185.00 price target.