Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of premium housewares retailer Williams-Sonoma
So what: To some extent, the declines in Williams-Sonoma's stock today seem a bit ridiculous. We've been seeing a lot of strong results in the luxury goods sector lately from the likes of Nordstrom
Now what: So why the sour puss from Mr. Market? The company set its fourth-quarter earnings guidance in a range of $0.88 to $0.93, which put the midpoint a hair below the average analyst estimate and caused investors to freak out. And while that does seem a bit drastic given the company's strong results, it's worth noting that Williams-Sonoma shares have absolutely trounced the market over the past year, tacking on more than 50%. The shares now carry a premium valuation, and for that, investors expect premium results. The business at Williams-Sonoma appears to be doing quite well, but the stock may have gotten a little ahead of itself.
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