Williams Sonoma (WSM) sinks 5% on lofty outlook
By Robert Davis
19:08, 19 November 2021
Home retailer Williams Sonoma saw its stock drop by more than 5% to $210.94 (£156.79) before the US markets opened on Friday after the company released a lofty outlook in its third quarter earnings.
The stock recovered to $219.30 on the day by 15:00 UTC, representing a climb of 0.22%.
One reason the stock was able to recover is that Williams Sonoma reported strong third quarter earnings, even though some analysts say the company’s outlook is ambitious.
Williams Sonoma reported net revenues of more than $2bn, representing a 16% increase on an annualised basis, according to the San Francisco, California-based company’s earnings statement.
The company’s net earnings for the quarter were $249.5m compared to the $201m the company recorded at this time last year.
EPS were reported at $3.37 in Q3 compared to $2.60 last year.
Laura Alber, the company’s president and chief executive officer, described Q3 as “yet another quarter of outperformance.”
“Our performance demonstrates that we can continue to take share in a fractured market, and deliver high-quality, sustainable earnings,” Alber said.
Investor sentiment for the stock remains strong as it has increased in value by more than 35% over the last six months.
Meanwhile, company leadership has lofty expectations for the future despite supply chain woes that are plaguing the retail industry.
Williams Sonoma raised its net revenue growth expectations to between 22% and 23% for the entire fiscal year.
The company also expects to report a non-GAAP operating margin between 16.9% to 17.1%, the earnings statement says.
Read more: Shares of Williams-Sonoma spike after raised outlook