Williams-Sonoma (WSM) Q3 Earnings Top, Comps Soft, Stock Down
Zacks Investment Research | Nov 15, 2018 09:30PM ET
Williams-Sonoma Inc.’s (NYSE:WSM) shares plunged more than 13% in the after-hour trading session on Nov 15, despite reporting better-than-expected earnings in the third quarter of fiscal 2018. Presumably, lower-than-expected revenues along with weak comparable brand revenues (comps) have disappointed investors. Notably, revenues and comps were at the lower end of management’s guided range.
Williams-Sonoma reported non-GAAP earnings of 95 cents per share (at the higher end of the guided range), surpassing the Zacks Consensus Estimate of 94 cents. The figure also grew 13.1% year over year.
The company’s revenues of $1,357 million missed the consensus mark of $1,363 million but grew 4.4% year over year.
Comps increased 3.1% compared with 4.6% increase in the second quarter and 3.3% growth in the year-ago quarter.
Meanwhile, demand comps (total customer orders placed in the quarter) were 4.6%, higher than reported comps growth of 3.1%. The company highlighted that the gap between demand comps and reported comps was mainly due to unexpected delays in product receipts owing to port congestion of products imported out of China, as many U.S. importers enhanced shipments ahead of the Jan 1 tariff increase.
The company’s West Elm brand’s comps grew 8.3% compared with 11.5% growth in the prior-year quarter. Also, Pottery Barn’s comps were up 1.4% from negative 0.3% in the year-ago quarter. Meanwhile, Pottery Barn Kids and Teen’s recorded flat comps compared with 0.9% growth in the year-ago quarter. The company’s Williams (NYSE:WMB) Sonoma brand’s comps were 2.1%, down from 2.3% growth registered in the prior-year quarter.
Williams-Sonoma, Inc. Price, Consensus and EPS Surprise
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