Piper Jaffray Cuts Price Target on Williams-Sonoma (WSM) Following 4Q Earnings Report
Piper Jaffray maintained a Neutral rating on Williams-Sonoma (NYSE: WSM), and cut the price target to $63.00 (from $72.00), following the company's 4Q earnings report. WSM reported EPS of $1.55 vs. consensus of $1.58 and guidance of $1.53 to $1.62. Comparable brand revenue growth was up 0.8%, driven by a 12.8% gain at West Elm, 0.1% at Pottery Barn Kids, and 0.9% at core Williams-Sonoma.
Analyst Neely Tamminga commented, "We are adjusting our estimates on the heels of WSM's report in which EPS of $1.55 came in below expectations of $1.58 for FQ4 yet full-year 2016/FY17 guidance came in at $3.50-$3.65 versus our expectations for $3.84 and the consensus mark of $3.75. For WSM, comps came in at 0.8% versus expectations of 3.6% and gross margins came in at 38.3% versus expectations of 39.4%. While FQ4 and the 2016/FY17 outlook came in below expectations, management reiterated their plans to maintain discipline in their inventory levels while also executing appropriate investments in their future. Longer-term, we believe WSM is a high-quality option in an increasingly competitive landscape for allthings-home and their path to double revenues and expand margins may take a longer time than investors are willing to wait; we remain Neutral on WSM shares."
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Shares of Williams-Sonoma closed at $59.46 yesterday.