Williams-Sonoma (WSM, Financial) has announced a strategic move to acquire the intellectual property of Dormify, an e-commerce platform focused on products and content for college students and young adults. This acquisition aligns with Williams-Sonoma's ambitions for sustained growth and enhancing its market presence. The company aims to relaunch Dormify in 2026, integrating it into their portfolio to broaden their customer base and strengthen their position in the market.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 18 analysts, the average target price for Williams-Sonoma Inc (WSM, Financial) is $179.93 with a high estimate of $215.00 and a low estimate of $127.67. The average target implies an upside of 7.85% from the current price of $166.83. More detailed estimate data can be found on the Williams-Sonoma Inc (WSM) Forecast page.
Based on the consensus recommendation from 24 brokerage firms, Williams-Sonoma Inc's (WSM, Financial) average brokerage recommendation is currently 2.6, indicating "Hold" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Williams-Sonoma Inc (WSM, Financial) in one year is $81.79, suggesting a downside of 50.97% from the current price of $166.83. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Williams-Sonoma Inc (WSM) Summary page.
WSM Key Business Developments
Release Date: May 22, 2025
- Revenue: $1.73 billion, with a positive 3.4% comp.
- Operating Margin: 16.8%.
- Earnings Per Share (EPS): $1.85, up 8.8% year-over-year without last year's adjustment.
- Gross Margin: 44.3%, 60 basis points lower than last year without the prior adjustment.
- Retail Comp: 6.2% increase.
- E-commerce Comp: 2.1% increase.
- Cash Balance: $1 million with no outstanding debt.
- Capital Expenditures: $58 million.
- Shareholder Returns: $165 million through share repurchases and dividends.
- Inventory: $1.3 billion, up 10% year-over-year.
- Pottery Barn Comp: 2% increase.
- Pottery Barn Children Comp: 3.8% increase.
- West Elm Comp: 0.2% increase.
- Williams-Sonoma Brand Comp: 7.3% increase.
- B2B Growth: 8% increase.
- SG&A: 27.5% of revenues, 130 basis points lower than last year.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Williams-Sonoma Inc (WSM, Financial) reported a positive 3.4% comp in Q1, exceeding expectations with all brands delivering positive comps.
- The company achieved an operating margin of 16.8% and earnings per share of $1.85, with earnings growth of 8.8%.
- Strong performance was driven by improvements in furniture sales, effective collaborations, and robust retail and e-commerce channels.
- The B2B program grew by 8%, delivering another record-breaking quarter, and is seen as a key growth engine.
- Williams-Sonoma Inc (WSM) is leveraging AI to enhance customer experiences, improve sales performance, and optimize omnichannel capabilities.
Negative Points
- The company faces significant macroeconomic and geopolitical uncertainties, including high interest rates affecting the housing market.
- Merchandise margins declined by 220 basis points due to higher input costs, including ocean freight and tariff mitigation costs.
- The company is dealing with the impact of new tariffs, including a 30% tariff on China and a 10% global reciprocal tariff.
- Inventory levels increased by 10% due to strategic pull-forward of receipts to mitigate tariff impacts, which could affect cash flow.
- Despite strong results, the company acknowledges the volatility in the market and the potential need to adjust guidance if tariff policies change.
