Williams-Sonoma, Inc. Just Recorded A 11% EPS Beat: Here's What Analysts Are Forecasting Next

Shareholders will be ecstatic, with their stake up 32% over the past week following Williams-Sonoma, Inc.'s (NYSE:WSM) latest quarterly results. It looks like a credible result overall - although revenues of US$1.8b were in line with what the analysts predicted, Williams-Sonoma surprised by delivering a statutory profit of US$1.96 per share, a notable 11% above expectations. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

Check out our latest analysis for Williams-Sonoma

Taking into account the latest results, Williams-Sonoma's 22 analysts currently expect revenues in 2026 to be US$7.60b, approximately in line with the last 12 months. Statutory earnings per share are expected to shrink 3.1% to US$8.57 in the same period. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$7.62b and earnings per share (EPS) of US$8.17 in 2026. So the consensus seems to have become somewhat more optimistic on Williams-Sonoma's earnings potential following these results.

The consensus price target rose 18% to US$169, suggesting that higher earnings estimates flow through to the stock's valuation as well. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. Currently, the most bullish analyst values Williams-Sonoma at US$195 per share, while the most bearish prices it at US$123. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await Williams-Sonoma shareholders.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. We would highlight that Williams-Sonoma's revenue growth is expected to slow, with the forecast 0.8% annualised growth rate until the end of 2026 being well below the historical 5.8% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 4.7% per year. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Williams-Sonoma.

The Bottom Line

The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Williams-Sonoma following these results. Fortunately, the analysts also reconfirmed their revenue estimates, suggesting that it's tracking in line with expectations. Although our data does suggest that Williams-Sonoma's revenue is expected to perform worse than the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.

Following on from that line of thought, we think that the long-term prospects of the business are much more relevant than next year's earnings. We have forecasts for Williams-Sonoma going out to 2027, and you can see them free on our platform here.

And what about risks? Every company has them, and we've spotted 1 warning sign for Williams-Sonoma you should know about.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.