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Williams-Sonoma (WSM)
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Williams-Sonoma (WSM) AI Stock Analysis

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Williams-Sonoma

(NYSE:WSM)

Rating:80Outperform
Price Target:
$189.00
▲(10.88%Upside)
Williams-Sonoma's strong financial performance and positive earnings call sentiment drive the overall score. Technical analysis and valuation are moderate, indicating fair pricing. Corporate events bolster strategic growth and financial stability.
Positive Factors
Financial Performance
Williams-Sonoma reported a sequential improvement in comparable sales with all brands positive and business-to-business sales increasing by 8% year-over-year.
Growth and Market Position
WSM is focused on returning to growth through its own initiatives, gaining market share, and driving profitability.
Investment and Strategy
WSM is leveraging its strong free cash flow, pristine balance sheet, and prudent cost management to invest in technology and supply chain to widen its advantage.
Negative Factors
Cost Challenges
The gross margin declined due to lower merchandise margins driven by higher input costs such as increased ocean freight and tariff mitigation expenses.
Market Uncertainty
The neutral rating is reiterated due to uncertainty in tariff and macroeconomic environments, despite market share gains and strong operating margins.
Merchandise Margin Pressure
This merchandise margin erosion will likely overshadow what was a solid overall 1Q performance.

Williams-Sonoma (WSM) vs. SPDR S&P 500 ETF (SPY)

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, Inc. generates revenue primarily through the sale of its diverse range of home products across its multiple subsidiary brands. The company operates both brick-and-mortar retail locations and a robust e-commerce platform, which together form the backbone of its revenue model. Key revenue streams include direct-to-consumer sales through its online platforms and physical stores, as well as catalog sales. The company leverages its strong brand portfolio to target different segments of the home goods market, from affordable to luxury offerings. Additionally, Williams-Sonoma benefits from strategic partnerships and collaborations that enhance its product offerings and expand its market reach. Its in-house design team and global supply chain operations also contribute significantly to maintaining competitive pricing and product availability, bolstering its overall earnings.

Williams-Sonoma Financial Statement Overview

Summary
Williams-Sonoma demonstrates strong profitability with high margins and effective cost management, as well as robust cash flow generation. While the balance sheet is healthy with moderate leverage, slight declines in revenue and assets present potential future challenges.
Income Statement
85
Very Positive
Williams-Sonoma has demonstrated strong profitability and revenue stability. The TTM Gross Profit Margin stands at 46.23%, and the Net Profit Margin is 14.35%, indicating efficient cost management and strong bottom-line performance. EBIT and EBITDA Margins are also solid at 18.39% and 20.90% respectively. However, revenue growth has been slightly inconsistent, with a negative trajectory in recent periods compared to the peak in 2023.
Balance Sheet
77
Positive
The company maintains a healthy balance sheet with an Equity Ratio of 41.92%, showcasing a strong equity position. The Debt-to-Equity Ratio is 0.63, indicating moderate leverage. Return on Equity is impressive at 51.66%, signifying effective use of shareholders' equity to generate profits. However, total assets and stockholders' equity have slightly decreased over time, indicating potential future risks if the trend continues.
Cash Flow
80
Positive
Williams-Sonoma exhibits robust cash flow management, with a Free Cash Flow of $1.01 billion in the TTM period. The Operating Cash Flow to Net Income Ratio is 1.12, indicating strong alignment between cash generation and profitability. Although the Free Cash Flow Growth Rate has declined due to previous high levels, the company still maintains a positive cash flow trajectory, providing flexibility for future investments.
BreakdownTTMMar 2025Mar 2024Mar 2023Mar 2022Mar 2021
Income Statement
Total Revenue7.78B7.71B7.75B8.67B8.25B6.78B
Gross Profit3.60B3.58B3.30B3.68B3.63B2.64B
EBITDA1.63B1.66B1.49B1.50B1.65B1.13B
Net Income1.12B1.13B949.76M1.13B1.13B680.71M
Balance Sheet
Total Assets5.16B5.30B5.27B4.66B4.63B4.66B
Cash, Cash Equivalents and Short-Term Investments1.05B1.21B1.26B367.34M850.34M1.20B
Total Debt1.37B1.35B1.39B1.44B1.28B1.53B
Total Liabilities3.00B3.16B3.15B2.96B2.96B3.01B
Stockholders Equity2.16B2.14B2.13B1.70B1.66B1.65B
Cash Flow
Free Cash Flow1.01B1.14B1.49B698.71M1.14B1.11B
Operating Cash Flow1.25B1.36B1.68B1.05B1.37B1.27B
Investing Cash Flow-239.95M-221.21M-188.26M-353.95M-226.25M-168.88M
Financing Cash Flow-1.22B-1.18B-598.31M-1.18B-1.49B-343.02M

Williams-Sonoma Technical Analysis

Technical Analysis Sentiment
Positive
Last Price170.46
Price Trends
50DMA
163.73
Positive
100DMA
164.70
Positive
200DMA
168.16
Positive
Market Momentum
MACD
3.59
Negative
RSI
56.74
Neutral
STOCH
73.59
Neutral
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 170.46 is above the 20-day moving average (MA) of 165.10, above the 50-day MA of 163.73, and above the 200-day MA of 168.16, indicating a bullish trend. The MACD of 3.59 indicates Negative momentum. The RSI at 56.74 is Neutral, neither overbought nor oversold. The STOCH value of 73.59 is Neutral, 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

Overall Rating
UnderperformOutperform
Sector (63)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
WSWSM
80
Outperform
$21.50B19.7951.10%1.51%1.64%8.57%
DKDKS
78
Outperform
$16.81B15.0140.22%2.31%3.33%15.47%
DGDG
77
Outperform
$24.90B21.5815.69%2.08%4.77%-23.73%
BBBBY
71
Outperform
$15.17B17.5430.21%5.29%-3.23%-28.11%
DPDPZ
70
Outperform
$15.91B26.63-14.74%1.50%4.28%13.76%
63
Neutral
$16.85B11.30-7.01%2.93%1.72%-24.85%
60
Neutral
$22.82B19.25%-20.46%-202.26%
* Consumer Cyclical Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
WSM
Williams-Sonoma
170.46
9.98
6.22%
BBY
Best Buy Co
70.95
-12.33
-14.81%
DKS
Dick's Sporting Goods
208.85
-12.57
-5.68%
DG
Dollar General
114.39
-9.77
-7.87%
DLTR
Dollar Tree
108.63
3.81
3.63%
DPZ
Domino's Pizza
472.94
-9.66
-2.00%

Williams-Sonoma Corporate Events

Private Placements and FinancingBusiness Operations and Strategy
Williams-Sonoma Amends Credit Agreement with Bank of America
Positive
Jun 27, 2025

On June 26, 2025, Williams-Sonoma, Inc. announced an amendment to its credit agreement with Bank of America, extending the maturity date of its revolving loan facility to 2030 and increasing its aggregate commitments to $600 million. This strategic financial move, which also involves transitioning to the Term SOFR standard and adjusting interest rates and fees, is expected to enhance the company’s financial flexibility and support its growth objectives, while maintaining certain covenants and guarantees from its U.S. subsidiaries.

The most recent analyst rating on (WSM) stock is a Buy with a $170.00 price target. To see the full list of analyst forecasts on Williams-Sonoma stock, see the WSM Stock Forecast page.

Executive/Board ChangesShareholder MeetingsBusiness Operations and Strategy
Williams-Sonoma Elects Directors at Annual Meeting
Positive
Jun 13, 2025

On June 11, 2025, Williams-Sonoma, Inc. held its 2025 Annual Meeting of Stockholders, where all director nominees were elected, and proposals regarding executive compensation and the selection of Deloitte & Touche LLP as the independent accounting firm were approved. These decisions reflect the company’s continued commitment to strong governance and financial transparency, potentially impacting its operational strategies and stakeholder confidence positively.

The most recent analyst rating on (WSM) stock is a Buy with a $170.00 price target. To see the full list of analyst forecasts on Williams-Sonoma stock, see the WSM Stock Forecast page.

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.Date of analysis: Jun 28, 2025