Morgan Stanley Remains Equalweight on Williams-Sonoma (WSM) Following 2Q

August 25, 2016 11:50 AM EDT
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Price: $46.52 +0.41%

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    14 Buy, 21 Hold, 3 Sell

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Morgan Stanley maintained an Equalweight rating on Williams-Sonoma (NYSE: WSM), and cut the price target to $54.00 (from $55.00), following the company's 2Q earnings report. EPS of $0.58 was inline on lower SG&A, resulting from cost cuts enacted at the end of 2015. Comparable brand growth was light at +0.6%, below the guidance range of 1-4%.

Analyst Simeon Gutman commented, "Our key takeaway from Q2 results is WSM's operating margins may struggle to expand. While Q2 EBIT margin was in-line, comps were weaker than expected (+0.6% vs. +2.8% consensus). The cost of growing sales is increasing for WSM and the broader home furnishings segment and we believe it will be difficult to drive improvement in both sales and EBIT margin over time."

For an analyst ratings summary and ratings history on Williams-Sonoma click here. For more ratings news on Williams-Sonoma click here.

Shares of Williams-Sonoma closed at $54.14 yesterday.

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