NYSE:WSM

Stock Analysis Report

Executive Summary

Williams-Sonoma, Inc. operates as a multi-channel specialty retailer of various products for home.

Rewards

Trading at 23.8% below its fair value

Earnings are forecast to grow 6.32% per year

Earnings grew by 24.3% over the past year

Pays a high and reliable dividend of 2.53%

Risk Analysis

No risks detected for WSM from our risk checks.


Snowflake Analysis

Outstanding track record with excellent balance sheet and pays a dividend.


Similar Companies

Share Price & News

How has Williams-Sonoma's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: WSM has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-1.5%

WSM

0.6%

US Specialty Retail

-0.09%

US Market


1 Year Return

42.6%

WSM

23.3%

US Specialty Retail

23.9%

US Market

Return vs Industry: WSM exceeded the US Specialty Retail industry which returned 23.7% over the past year.

Return vs Market: WSM exceeded the US Market which returned 24.7% over the past year.


Shareholder returns

WSMIndustryMarket
7 Day-1.5%0.6%-0.09%
30 Day3.1%1.1%3.1%
90 Day9.3%6.8%10.4%
1 Year46.7%42.6%25.3%23.3%26.6%23.9%
3 Year74.0%58.9%46.3%38.8%50.9%41.2%
5 Year10.9%-3.6%49.3%36.6%78.1%58.5%

Price Volatility Vs. Market

How volatile is Williams-Sonoma's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Williams-Sonoma undervalued compared to its fair value and its price relative to the market?

24.4%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: WSM ($76.01) is trading below our estimate of fair value ($99.81)

Significantly Below Fair Value: WSM is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: WSM is good value based on its PE Ratio (17.2x) compared to the Specialty Retail industry average (17.4x).

PE vs Market: WSM is good value based on its PE Ratio (17.3x) compared to the US market (18.9x).


Price to Earnings Growth Ratio

PEG Ratio: WSM is poor value based on its PEG Ratio (2.7x)


Price to Book Ratio

PB vs Industry: WSM is overvalued based on its PB Ratio (5.2x) compared to the US Specialty Retail industry average (1.5x).


Next Steps

Future Growth

How is Williams-Sonoma forecast to perform in the next 1 to 3 years based on estimates from 22 analysts?

6.3%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: WSM's forecast earnings growth (6.3% per year) is above the savings rate (1.7%).

Earnings vs Market: WSM's earnings (6.3% per year) are forecast to grow slower than the US market (14.3% per year).

High Growth Earnings: WSM's earnings are forecast to grow, but not significantly.

Revenue vs Market: WSM's revenue (3.3% per year) is forecast to grow slower than the US market (7.5% per year).

High Growth Revenue: WSM's revenue (3.3% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: WSM's Return on Equity is forecast to be high in 3 years time (31.4%)


Next Steps

Past Performance

How has Williams-Sonoma performed over the past 5 years?

1.0%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: WSM has high quality earnings.

Growing Profit Margin: WSM's current net profit margins (5.9%) are higher than last year (5%).


Past Earnings Growth Analysis

Earnings Trend: WSM's earnings have grown by 1% per year over the past 5 years.

Accelerating Growth: WSM's earnings growth over the past year (24.3%) exceeds its 5-year average (1% per year).

Earnings vs Industry: WSM earnings growth over the past year (24.3%) exceeded the Specialty Retail industry 4.5%.


Return on Equity

High ROE: WSM's Return on Equity (30.5%) is considered high.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Williams-Sonoma's financial position?


Financial Position Analysis

Short Term Liabilities: WSM's short term assets ($1.7B) exceed its short term liabilities ($1.3B).

Long Term Liabilities: WSM's short term assets ($1.7B) exceed its long term liabilities ($1.5B).


Debt to Equity History and Analysis

Debt Level: WSM's debt to equity ratio (35.3%) is considered satisfactory.

Reducing Debt: WSM's debt to equity ratio has increased from 2.3% to 35.3% over the past 5 years.

Debt Coverage: WSM's debt is well covered by operating cash flow (124.2%).

Interest Coverage: WSM's interest payments on its debt are well covered by EBIT (51.8x coverage).


Balance Sheet

Inventory Level: WSM has a high level of physical assets or inventory.

Debt Coverage by Assets: WSM's debt is covered by short term assets (assets are 4.2x debt).


Next Steps

Dividend

What is Williams-Sonoma's current dividend yield, its reliability and sustainability?

2.54%

Current Dividend Yield


Dividend Yield vs Market

company2.5%marketbottom25%1.4%markettop25%3.7%industryaverage1.8%forecastin3Years2.7%

Current dividend yield vs market & industry

Notable Dividend: WSM's dividend (2.53%) is higher than the bottom 25% of dividend payers in the US market (1.4%).

High Dividend: WSM's dividend (2.53%) is low compared to the top 25% of dividend payers in the US market (3.66%).


Stability and Growth of Payments

Stable Dividend: WSM's dividends per share have been stable in the past 10 years.

Growing Dividend: WSM's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (42.6%), WSM's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: WSM's dividends in 3 years are forecast to be well covered by earnings (37.7% payout ratio).


Next Steps

Management

What is the CEO of Williams-Sonoma's salary, the management and board of directors tenure and is there insider trading?

6.5yrs

Average management tenure


CEO

Laura Alber (50yo)

9.7yrs

Tenure

US$27,254,166

Compensation

Ms. Laura J. Alber has been the Chief Executive Officer at Williams-sonoma Inc. since May 26, 2010 and has been its President since July 2006. Ms. Alber served as the President of Pottery Barn Brands, a su ...


CEO Compensation Analysis

Compensation vs Market: Laura's total compensation ($USD27.25M) is above average for companies of similar size in the US market ($USD6.46M).

Compensation vs Earnings: Laura's compensation has increased by more than 20% in the past year.


Management Age and Tenure

6.5yrs

Average Tenure

50yo

Average Age

Experienced Management: WSM's management team is seasoned and experienced (6.5 years average tenure).


Board Age and Tenure

2.7yrs

Average Tenure

56yo

Average Age

Experienced Board: WSM's board of directors are not considered experienced ( 2.7 years average tenure), which suggests a new board.


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

SellUS$314,50510 Sep 19
Alex Bellos
EntityIndividual
Role
Senior Key Executive
President of West Elm Brand
Shares4,820
Max PriceUS$65.25
SellUS$308,00020 Jun 19
Marta Benson
EntityIndividual
Role
Senior Key Executive
President of Pottery Barn Brand
Shares5,000
Max PriceUS$61.60
SellUS$105,14004 Jun 19
Sabrina Simmons
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares1,750
Max PriceUS$60.08

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Management Team

  • Laura Alber (50yo)

    President

    • Tenure: 9.7yrs
    • Compensation: US$27.25m
  • Dean Miller (56yo)

    Executive VP & COO

    • Tenure: 5.5yrs
    • Compensation: US$1.46m
  • Marta Benson (56yo)

    President of Pottery Barn Brand

    • Compensation: US$4.67m
  • Felix Carbullido (54yo)

    Executive VP & Chief Marketing Officer

    • Tenure: 5.5yrs
  • David King (50yo)

    Executive VP

    • Tenure: 9yrs
  • Julie Whalen (48yo)

    Executive VP & CFO

    • Tenure: 7.5yrs
    • Compensation: US$4.08m
  • Yasir Anwar

    Chief Technology Officer

    • Tenure: 1.9yrs
  • Alex Bellos (34yo)

    President of West Elm Brand

    • Compensation: US$4.25m
  • Elise Wang

    Vice President of Investor Relations

    • Brian Yee

      Senior VP of Corporate Finance & Treasurer


      Board Members

      • Adrian D. Bellamy (77yo)

        Independent Chairman

        • Tenure: 9.7yrs
        • Compensation: US$730.41k
      • Frits van Paasschen (58yo)

        Independent Director

        • Tenure: 2.7yrs
        • Compensation: US$246.01k
      • Anne Mulcahy (67yo)

        Independent Director

        • Tenure: 1.3yrs
        • Compensation: US$118.47k
      • Sabrina Simmons (56yo)

        Independent Director

        • Tenure: 5yrs
        • Compensation: US$299.86k
      • Laura Alber (50yo)

        President

        • Tenure: 9.7yrs
        • Compensation: US$27.25m
      • Scott Dahnke (54yo)

        Independent Director

        • Tenure: 0.8yrs
      • Grace Puma (56yo)

        Independent Director

        • Tenure: 2.7yrs
        • Compensation: US$249.13k

      Company Information

      Williams-Sonoma, Inc.'s company bio, employee growth, exchange listings and data sources


      Key Information

      • Name: Williams-Sonoma, Inc.
      • Ticker: WSM
      • Exchange: NYSE
      • Founded: 1956
      • Industry: Homefurnishing Retail
      • Sector: Retail
      • Market Cap: US$5.846b
      • Shares outstanding: 77.47m
      • Website: https://www.williams-sonomainc.com

      Number of Employees


      Location

      • Williams-Sonoma, Inc.
      • 3250 Van Ness Avenue
      • San Francisco
      • California
      • 94109
      • United States

      Listings

      TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
      WSMNYSE (New York Stock Exchange)YesCommon StockUSUSDJul 1983
      WM1DB (Deutsche Boerse AG)YesCommon StockDEEURJul 1983
      WSM *BMV (Bolsa Mexicana de Valores)YesCommon StockMXMXNJul 1983
      0LXCLSE (London Stock Exchange)YesCommon StockGBUSDJul 1983

      Biography

      Williams-Sonoma, Inc. operates as a multi-channel specialty retailer of various products for home. The company operates through two segments, E-commerce and Retail. 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 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. The company also provides home decor products under the West Elm brand; products designed for creating spaces where children could play, laugh, learn, and grow under the Pottery Barn Kids brand; and line of furniture, bedding, lighting, decorative accents, and others for teen bedrooms, dorm rooms, study spaces, and lounges under the PBteen brand. In addition, it offers a range of assortments of lighting, hardware, furniture, and home décor inspired by history under the Rejuvenation brand; and women’s and men’s accessories, small leather goods, jewelry, key item apparel, paper, entertaining and bar, home décor, and seasonal items under the Mark and Graham brand. The company markets its products through e-commerce Websites, direct mail catalogs, and retail stores. As of February 3, 2019, it operated 625 stores comprising 579 stores in 43 states, Washington, D.C., and Puerto Rico; 24 stores in Canada; 19 stores in Australia; and 3 store in the United Kingdom, as well as 108 franchised stores, as well as e-commerce Websites in various countries in the Middle East, the Philippines, Mexico, and South Korea. Williams-Sonoma, Inc. was founded in 1956 and is headquartered in San Francisco, California. 


      Company Analysis and Financial Data Status

      All financial data provided by Standard & Poor's Capital IQ.
      DataLast Updated (UTC time)
      Company Analysis2020/01/24 00:01
      End of Day Share Price2020/01/23 00:00
      Earnings2019/11/03
      Annual Earnings2019/02/03


      Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.