Morgan Stanley Remains Equalweight on Williams-Sonoma (WSM) Following 2Q
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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."
Shares of Williams-Sonoma closed at $54.14 yesterday.
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Create E-mail Alert Related CategoriesAnalyst Comments, Analyst EPS Change, Analyst EPS View, Analyst PT Change
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