Education
About Us
Working with TipRanks
Follow Us
Williams-Sonoma (WSM)
NYSE:WSM
Top Page
Williams-Sonoma
(NYSE:WSM)
Select Model
Select Model
Rating:75Outperform
Price Target:
$202.00
▲(2.12% Upside)
Williams-Sonoma's overall stock score is driven by its strong financial performance and positive earnings call sentiment. The company's robust profitability, effective cash management, and strategic AI initiatives are significant strengths. However, technical analysis indicates potential bearish momentum, and tariff challenges pose risks. The valuation is fair, supporting a balanced investment outlook.
Positive Factors
Revenue Growth
Williams-Sonoma's Q3 revenue exceeded expectations, indicating strong demand and effective sales strategies, supporting long-term growth.
Operating Margin
The expansion of operating margins demonstrates efficient cost management and pricing strategies, enhancing profitability over time.
AI Integration
Successful AI integration improves customer service efficiency and engagement, providing a competitive edge and supporting operational scalability.
Negative Factors
Tariff Challenges
Increased tariffs on key imports could pressure cost structures and margins, posing long-term challenges to profitability and competitiveness.
SG&A Expenses
Rising SG&A expenses may strain profitability if not managed effectively, impacting long-term financial performance and operational efficiency.
Volatile Tariff Environment
Ongoing tariff volatility introduces uncertainty in cost management and pricing strategies, potentially affecting long-term strategic planning.
Williams-Sonoma (WSM) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$23.61B
Dividend Yield1.37%
Average Volume (3M)1.11M
Price to Earnings (P/E)21.9
Beta (1Y)1.40
Revenue Growth5.10%
EPS Growth7.59%
CountryUS
Employees19,600
SectorConsumer Cyclical
Sector Strength84
IndustrySpecialty Retail
Share Statistics
EPS (TTM)1.96
Shares Outstanding119,380,714
10 Day Avg. Volume915,819
30 Day Avg. Volume1,105,157
Financial Highlights & Ratios
PEG Ratio1.12
Price to Book (P/B)12.45
Price to Sales (P/S)3.46
P/FCF Ratio23.43
Enterprise Value/Market Cap1.02
Enterprise Value/Revenue3.03
Enterprise Value/Gross Profit6.64
Enterprise Value/Ebitda14.76
Forecast
1Y Price Target
$203.67Price Target Upside2.96% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering13
EPS Forecast (FY)8.7
Revenue Forecast (FY)$7.86B
Williams-Sonoma Business Overview & Revenue Model
Company DescriptionWilliams-Sonoma, Inc. operates as an omni-channel specialty retailer of various products for home. It offers cooking, dining, and entertaining products, such as cookware, tools, electrics, cutlery, tabletop and bar, outdoor, furniture, and a library of cookbooks under the Williams Sonoma Home brand, as well as home furnishings and decorative accessories under the Williams Sonoma lifestyle brand; and furniture, bedding, lighting, rugs, table essentials, and decorative accessories under the Pottery Barn brand. The company also provides home decor products under the West Elm brand; kids accessories under the Pottery Barn Kids brand; and an organic bedding to multi-purpose furniture under the Pottery Barn Teen brand. In addition, it offers made-to-order lighting, hardware, furniture, and home decors inspired by history under the Rejuvenation brand; and women's and men's accessories, travel, entertaining and bar, home décor, and seasonal items under the Mark and Graham brand, as well as operates a 3-D imaging and augmented reality platform for the home furnishings and décor industry. The company markets its products through e-commerce websites, direct-mail catalogs, and retail stores. It operates 544 stores comprising 502 stores in 41states, Washington, D.C., and Puerto Rico; 20 stores in Canada; 19 stores in Australia; 3 stores in the United Kingdom; and 139 franchised stores, as well as e-commerce websites in various countries in the Middle East, the Philippines, Mexico, South Korea, and India. Williams-Sonoma, Inc. was founded in 1956 and is headquartered in San Francisco, California.
How the Company Makes MoneyWilliams-Sonoma generates revenue primarily through the sale of its products across various channels, including retail stores, e-commerce platforms, and catalog sales. The company has a robust online presence, which contributes significantly to its sales, especially in recent years as consumer preferences have shifted towards online shopping. Key revenue streams include direct sales from its branded websites and physical stores, as well as wholesale distribution to third-party retailers. Additionally, the company benefits from substantial customer loyalty programs and membership initiatives that encourage repeat purchases. Strategic partnerships with designers and influencers, as well as collaborations with other brands, enhance its product offerings and market reach, further contributing to its earnings.
Williams-Sonoma Earnings Call Summary
Earnings Call Date:Nov 19, 2025
(Q3-2025)
| % Change Since: |
Next Earnings Date:Mar 18, 2026
Earnings Call Sentiment Positive
The earnings call reflects a generally positive sentiment with strong sales growth, robust operating margins, and successful AI integration. However, challenges remain with the volatile tariff environment and slightly increased SG&A expenses.Q3-2025 Updates
Positive Updates
Positive Comparable Sales Growth
Williams-Sonoma, Inc. achieved a positive 4% comp in Q3, with all brands delivering positive comparable sales, driven by strong performance in both furniture and non-furniture categories.
Strong Operating Margin
The company reported an operating margin of 17%, which is a 10 basis point expansion compared to the previous year, despite substantial tariff headwinds.
Earnings Per Share Growth
Earnings per share grew by 5% year over year to $1.96, exceeding expectations.
AI Implementation and Impact
AI-powered chat experiences now resolve over 60% of customer service chats without human assistance, reducing handle times significantly. The launch of Olive, an AI culinary and shopping companion, also enhances customer engagement.
Retail Channel Success
The retail channel experienced an 8.5% comp increase in Q3, benefiting from improved in-store experiences and inventory availability.
Negative Updates
Tariff Impact and Challenges
The company faces challenges with tariffs, including a new tariff on some furniture items and an increase in the incremental tariff rate from 14% to 29%, affecting cost structures.
Higher SG&A Expenses
SG&A expenses were 60 basis points higher year over year, attributed to higher incentive compensation and increased advertising expenses.
Volatility in Tariff Landscape
The tariff environment remains volatile, with uncertainty about future changes and their impact on the company's margins and operations.
Company Guidance
During the Williams-Sonoma, Inc. Third Quarter Fiscal 2025 Earnings Conference Call, the company provided updated guidance reflecting their strong performance and future expectations. They reported a 4% comparable brand revenue growth in Q3, surpassing expectations, with an operating margin of 17% and earnings per share of $1.96, a 5% increase year over year. For fiscal 2025, they reiterated their full-year comparable brand revenue growth projection of 2% to 5% and raised their operating margin guidance to 17.8% to 18.1%. The company highlighted gains in market share and strong performance in the retail channel, with an 8.5% comp in Q3. Additionally, they noted a positive impact from their AI initiatives, which improved customer service and operational efficiencies. Despite facing tariff headwinds, they effectively managed these challenges through a six-point mitigation plan and continued to focus on growth, customer service, and earnings.Williams-Sonoma Financial Statement Overview
Summary
Williams-Sonoma exhibits strong financial health with robust profitability and revenue growth. The balance sheet shows moderate leverage with high returns on equity, while cash flow statements confirm effective cash generation and management. Overall, the company is well-positioned in the specialty retail industry with a solid financial foundation.Income Statement
Williams-Sonoma demonstrates strong profitability with a consistent gross profit margin around 45% and a net profit margin of approximately 14% in TTM. The company has shown resilience with a positive revenue growth rate of 1.05% in TTM, recovering from a slight decline in the previous year. EBIT and EBITDA margins are robust, indicating efficient operations.Balance Sheet
The balance sheet reflects a stable financial position with a debt-to-equity ratio of 0.71 in TTM, indicating moderate leverage. Return on equity is impressive at 51.88%, showcasing effective use of equity to generate profits. The equity ratio remains healthy, suggesting a solid asset base.Cash Flow
Cash flow analysis reveals strong free cash flow growth of 7.71% in TTM, indicating effective cash management. The operating cash flow to net income ratio is 0.82, reflecting good cash conversion. The free cash flow to net income ratio of 0.90 further underscores the company's ability to generate cash relative to its earnings.| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 7.91B | 7.71B | 7.75B | 8.67B | 8.25B | 6.78B |
| Gross Profit | 3.61B | 3.58B | 3.30B | 3.68B | 3.63B | 2.64B |
| EBITDA | 1.62B | 1.66B | 1.48B | 1.71B | 1.65B | 1.10B |
| Net Income | 1.11B | 1.13B | 949.76M | 1.13B | 1.13B | 680.71M |
Balance Sheet | ||||||
| Total Assets | 5.31B | 5.30B | 5.27B | 4.66B | 4.63B | 4.66B |
| Cash, Cash Equivalents and Short-Term Investments | 884.66M | 1.21B | 1.26B | 367.34M | 850.34M | 1.20B |
| Total Debt | 1.47B | 1.35B | 1.39B | 1.44B | 1.28B | 1.53B |
| Total Liabilities | 3.24B | 3.16B | 3.15B | 2.96B | 2.96B | 3.01B |
| Stockholders Equity | 2.07B | 2.14B | 2.13B | 1.70B | 1.66B | 1.65B |
Cash Flow | ||||||
| Free Cash Flow | 1.11B | 1.14B | 1.49B | 698.71M | 1.14B | 1.11B |
| Operating Cash Flow | 1.35B | 1.36B | 1.68B | 1.05B | 1.37B | 1.27B |
| Investing Cash Flow | -246.89M | -221.21M | -188.26M | -353.95M | -226.25M | -168.88M |
| Financing Cash Flow | -1.05B | -1.18B | -598.31M | -1.18B | -1.49B | -343.02M |
Williams-Sonoma Technical Analysis
Positive
197.81
Price Trends
186.74
Positive
190.74
Positive
177.95
Positive
Market Momentum
2.22
Negative
61.10
Neutral
81.69
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For WSM, the sentiment is Positive. The current price of 197.81 is above the 20-day moving average (MA) of 188.57, above the 50-day MA of 186.74, and above the 200-day MA of 177.95, indicating a bullish trend. The MACD of 2.22 indicates Negative momentum. The RSI at 61.10 is Neutral, neither overbought nor oversold. The STOCH value of 81.69 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for WSM.
Williams-Sonoma Risk Analysis
Williams-Sonoma disclosed 41 risk factors in its most recent earnings report. Williams-Sonoma reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Williams-Sonoma Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
75 Outperform | $23.61B | 21.88 | 56.92% | 1.37% | 5.10% | 7.59% | |
62 Neutral | $15.05B | 23.31 | 22.49% | 5.46% | -0.95% | -48.28% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
57 Neutral | $6.04B | 42.81 | ― | ― | 1.98% | -20.98% | |
53 Neutral | $4.66B | 7.16 | ― | 4.16% | -1.04% | -20.88% | |
52 Neutral | $14.79B | -44.33 | ― | ― | 3.35% | 42.99% | |
49 Neutral | $4.04B | 38.75 | ― | ― | 9.74% | 55.13% |
* Consumer Cyclical Sector Average
WSM
Williams-Sonoma
197.81
5.47
2.84%
BBY
Best Buy Co
71.81
-8.20
-10.25%
BBWI
Bath & Body Works
22.77
-12.85
-36.08%
RH
RH
214.94
-204.58
-48.77%
W
Wayfair
113.45
69.74
159.55%
ETSY
Etsy
61.23
7.78
14.56%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.