Williams-Sonoma (WSM) Cut to “Sell” at Zacks Investment Research

Zacks Investment Research cut shares of Williams-Sonoma (NYSE:WSM) from a hold rating to a sell rating in a research report report published on Monday.

According to Zacks, “Shares of Williams-Sonoma have outperformed its industry in the past six months. Continued enhancement of e-commerce channel, optimization of supply chain and the transformation of retail fleet by investing in new and remodeled stores are expected to drive growth for William Sonoma. Moreover, the company’s focus on product innovation plays a huge role in the company’s success. However, high costs associated with continued investments in e-commerce and a competitive retail environment mar growth prospects. Further, supply-chain investments are creating pressure on the company’s operating margins. Intense competition and the company’s dependency on consumer discretionary spending further add to the woes. Also, earnings estimates for 2018 have decreased over the past 30 days, reflecting analysts' concern over the stock's earnings potential.”

A number of other equities analysts have also weighed in on WSM. Citigroup increased their target price on Williams-Sonoma from $67.00 to $70.00 and gave the stock a neutral rating in a research note on Thursday, August 23rd. Robert W. Baird increased their target price on Williams-Sonoma from $52.00 to $65.00 and gave the stock a neutral rating in a research note on Thursday, August 23rd. Argus set a $67.00 target price on Williams-Sonoma and gave the stock a buy rating in a research note on Friday, July 13th. Buckingham Research increased their target price on Williams-Sonoma from $54.00 to $64.00 and gave the stock a neutral rating in a research note on Thursday, August 23rd. Finally, Morgan Stanley increased their target price on Williams-Sonoma from $57.00 to $60.00 and gave the stock an equal weight rating in a research note on Thursday, October 11th. Six analysts have rated the stock with a sell rating, eighteen have assigned a hold rating and one has issued a buy rating to the stock. The stock presently has a consensus rating of Hold and an average target price of $59.23.

Shares of NYSE WSM opened at $61.24 on Monday. The company has a market cap of $4.82 billion, a PE ratio of 16.96, a PEG ratio of 1.76 and a beta of 0.82. The company has a debt-to-equity ratio of 0.28, a quick ratio of 0.40 and a current ratio of 1.56. Williams-Sonoma has a 1-year low of $44.01 and a 1-year high of $73.99.

Williams-Sonoma (NYSE:WSM) last announced its earnings results on Wednesday, August 22nd. The specialty retailer reported $0.77 earnings per share for the quarter, topping the Zacks’ consensus estimate of $0.68 by $0.09. The company had revenue of $1.28 billion for the quarter, compared to analyst estimates of $1.26 billion. Williams-Sonoma had a return on equity of 28.68% and a net margin of 4.84%. The firm’s quarterly revenue was up 6.1% compared to the same quarter last year. During the same quarter last year, the company earned $0.61 earnings per share. Equities research analysts predict that Williams-Sonoma will post 4.34 earnings per share for the current year.

The business also recently declared a quarterly dividend, which will be paid on Wednesday, November 21st. Investors of record on Friday, October 26th will be given a dividend of $0.43 per share. This represents a $1.72 dividend on an annualized basis and a yield of 2.81%. The ex-dividend date is Thursday, October 25th. Williams-Sonoma’s dividend payout ratio is currently 47.65%.

In other Williams-Sonoma news, insider Janet Hayes sold 14,376 shares of the firm’s stock in a transaction on Friday, September 14th. The stock was sold at an average price of $68.10, for a total value of $979,005.60. Following the sale, the insider now owns 44,889 shares of the company’s stock, valued at approximately $3,056,940.90. The sale was disclosed in a document filed with the SEC, which is available at the SEC website. Also, EVP David Randolph King sold 24,323 shares of the firm’s stock in a transaction on Friday, August 31st. The shares were sold at an average price of $68.88, for a total value of $1,675,368.24. Following the completion of the sale, the executive vice president now directly owns 17,589 shares in the company, valued at approximately $1,211,530.32. The disclosure for this sale can be found here. Corporate insiders own 1.00% of the company’s stock.

Several hedge funds have recently modified their holdings of the business. Private Advisor Group LLC acquired a new stake in shares of Williams-Sonoma in the 3rd quarter valued at $278,000. Sterling Capital Management LLC acquired a new stake in shares of Williams-Sonoma in the 3rd quarter valued at $905,000. JNBA Financial Advisors acquired a new stake in shares of Williams-Sonoma in the 3rd quarter valued at $168,000. US Bancorp DE boosted its holdings in shares of Williams-Sonoma by 61.4% in the 3rd quarter. US Bancorp DE now owns 97,709 shares of the specialty retailer’s stock valued at $6,422,000 after purchasing an additional 37,164 shares in the last quarter. Finally, Hutchinson Capital Management CA boosted its holdings in shares of Williams-Sonoma by 0.4% in the 3rd quarter. Hutchinson Capital Management CA now owns 262,375 shares of the specialty retailer’s stock valued at $17,244,000 after purchasing an additional 1,109 shares in the last quarter.

Williams-Sonoma Company Profile

Williams-Sonoma, Inc operates as a multi-channel specialty retailer of various products for home. It operates through two segments, E-commerce and Retail. The company offers cooking, dining, and entertaining products, including cookware, tools, electrics, cutlery, tabletop and bar, outdoor, furniture, and a library of cookbooks under the Williams Sonoma brand, as well as home furnishings and decorative accessories under the Williams Sonoma Home brand; and furniture, bedding, bathroom accessories, rugs, curtains, lighting, tabletop, outdoor, and decorative accessories under the Pottery Barn brand.

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