Williams-Sonoma Earnings Preview

Watch Williams-Sonoma's (NYSE: WSM  ) earnings report to see if it can beat analyst expectations for the fifth consecutive quarter. The company will unveil its latest earnings on Thursday. Williams-Sonoma is a retailer of products for the home. The retail segment of its business sells products through five retail store concepts: Williams-Sonoma, Pottery Barn, Pottery Barn Kids, West Elm, and Williams-Sonoma Home.

What analysts say:

• Buy, sell, or hold?: Analysts think investors should stand pat on Williams-Sonoma with 11 of 18 analysts rating it hold. Analysts don't like Williams-Sonoma as much as competitor Pier 1 Imports overall. Seven out of eight analysts rate Pier 1 Imports a buy compared to seven of 18 for Williams-Sonoma. While analysts still rate the stock a hold, they are a little more optimistic about it compared to three months ago.
• Revenue forecasts: On average, analysts predict $856.2 million in revenue this quarter. That would represent a rise of 5% from the year-ago quarter.
• Wall Street earnings expectations: The average analyst estimate is earnings of $0.38 per share. Estimates range from $0.37 to $0.40.

What our community says:
CAPS All-Stars are solidly backing the stock with 75.3% assigning it an outperform rating. The majority of the Fools are in agreement with the All-Stars as 67% give it an outperform rating. Fools are bullish on Williams-Sonoma and haven't been shy with their opinions lately, logging 137 posts in the past 30 days. Williams-Sonoma's bearish CAPS rating of two out of five stars falls short of the Fool community sentiment.

Management:
Williams-Sonoma's profit has risen year over year by an average of more than twofold over the past five quarters. Revenue has now gone up for three straight quarters.

Now let's look at how efficient management is at running the business. Traditionally, margins represent the efficiency with which companies capture portions of sales dollars. The following table shows gross, operating, and net margins over the past four quarters.

Quarter	Q2	Q1	Q4	Q3
Gross Margin	37.9%	38.4%	42.3%	38.2%
Operating Margin	7.9%	6.7%	15.4%	6.9%
Net Margin	4.8%	4.1%	9.5%	4.5%

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Earnings estimates provided by Zacks