The 10-second takeaway
For the quarter ended Oct. 28 (Q3), Williams-Sonoma beat expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue grew and GAAP earnings per share increased significantly.
Margins expanded across the board.
Williams-Sonoma tallied revenue of $944.6 million. The 24 analysts polled by S&P Capital IQ wanted to see revenue of $922.2 million on the same basis. GAAP reported sales were 8.9% higher than the prior-year quarter's $867.2 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.49. The 24 earnings estimates compiled by S&P Capital IQ forecast $0.46 per share. GAAP EPS of $0.49 for Q3 were 20% higher than the prior-year quarter's $0.41 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 52.8%, 10 basis points better than the prior-year quarter. Operating margin was 8.4%, 50 basis points better than the prior-year quarter. Net margin was 5.2%, 20 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $1.40 billion. On the bottom line, the average EPS estimate is $1.30.
Next year's average estimate for revenue is $4.04 billion. The average EPS estimate is $2.55.
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 216 members out of 313 rating the stock outperform, and 97 members rating it underperform. Among 89 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 74 give Williams-Sonoma a green thumbs-up, and 15 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Williams-Sonoma is outperform, with an average price target of $44.15.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool has no positions in the stocks mentioned above. Motley Fool newsletter services recommend Williams-Sonoma. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.