WILLIAMS-SONOMA INC (WSM) Stock Fundamental Analysis
NYSE:WSM - New York Stock Exchange, Inc. - US9699041011 - Common Stock - Currency: USD
We assign a fundamental rating of 7 out of 10 to WSM. WSM was compared to 121 industry peers in the Specialty Retail industry. WSM gets an excellent profitability rating and is at the same time showing great financial health properties. WSM is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year WSM was profitable.
WSM had a positive operating cash flow in the past year.
Each year in the past 5 years WSM has been profitable.
WSM had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
WSM's Return On Assets of 21.15% is amongst the best of the industry. WSM outperforms 97.52% of its industry peers.
With an excellent Return On Equity value of 50.47%, WSM belongs to the best of the industry, outperforming 95.04% of the companies in the same industry.
Looking at the Return On Invested Capital, with a value of 30.57%, WSM belongs to the top of the industry, outperforming 95.87% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for WSM is significantly above the industry average of 13.07%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 21.15% | ||
| ROE | 50.47% | ||
| ROIC | 30.57% |
ROA(3y)21.14%
ROA(5y)20.48%
ROE(3y)54.49%
ROE(5y)54.47%
ROIC(3y)32.3%
ROIC(5y)31.62%
1.3 Margins
WSM has a better Profit Margin (14.02%) than 95.04% of its industry peers.
In the last couple of years the Profit Margin of WSM has grown nicely.
With an excellent Operating Margin value of 17.95%, WSM belongs to the best of the industry, outperforming 95.04% of the companies in the same industry.
In the last couple of years the Operating Margin of WSM has grown nicely.
WSM's Gross Margin of 45.57% is fine compared to the rest of the industry. WSM outperforms 71.90% of its industry peers.
WSM's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 17.95% | ||
| PM (TTM) | 14.02% | ||
| GM | 45.57% |
OM growth 3Y1.81%
OM growth 5Y18.68%
PM growth 3Y2.23%
PM growth 5Y19.3%
GM growth 3Y1.79%
GM growth 5Y5.07%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so WSM is creating value.
The number of shares outstanding for WSM has been reduced compared to 1 year ago.
WSM has more shares outstanding than it did 5 years ago.
There is no outstanding debt for WSM. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
2.2 Solvency
WSM has an Altman-Z score of 7.32. This indicates that WSM is financially healthy and has little risk of bankruptcy at the moment.
WSM's Altman-Z score of 7.32 is amongst the best of the industry. WSM outperforms 95.87% of its industry peers.
WSM has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Altman-Z | 7.32 |
ROIC/WACC3.22
WACC9.48%
2.3 Liquidity
A Current Ratio of 1.51 indicates that WSM should not have too much problems paying its short term obligations.
WSM's Current ratio of 1.51 is fine compared to the rest of the industry. WSM outperforms 61.98% of its industry peers.
A Quick Ratio of 0.73 indicates that WSM may have some problems paying its short term obligations.
WSM has a better Quick ratio (0.73) than 62.81% of its industry peers.
WSM does not score too well on the current and quick ratio evaluation. However, as it has excellent solvency and profitability, these ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.51 | ||
| Quick Ratio | 0.73 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 12.48% over the past year.
WSM shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 29.28% yearly.
Looking at the last year, WSM shows a small growth in Revenue. The Revenue has grown by 1.64% in the last year.
Measured over the past years, WSM shows a small growth in Revenue. The Revenue has been growing by 5.51% on average per year.
EPS 1Y (TTM)12.48%
EPS 3Y5.36%
EPS 5Y29.28%
EPS Q2Q%6.32%
Revenue 1Y (TTM)1.64%
Revenue growth 3Y-2.21%
Revenue growth 5Y5.51%
Sales Q2Q%4.2%
3.2 Future
The Earnings Per Share is expected to grow by 7.32% on average over the next years.
WSM is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 3.52% yearly.
EPS Next Y-0.92%
EPS Next 2Y2.38%
EPS Next 3Y4.57%
EPS Next 5Y7.32%
Revenue Next Year1.82%
Revenue Next 2Y2.45%
Revenue Next 3Y2.93%
Revenue Next 5Y3.52%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 19.61, the valuation of WSM can be described as rather expensive.
WSM's Price/Earnings ratio is a bit cheaper when compared to the industry. WSM is cheaper than 69.42% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 27.45, WSM is valued a bit cheaper.
The Price/Forward Earnings ratio is 18.95, which indicates a rather expensive current valuation of WSM.
WSM's Price/Forward Earnings ratio is in line with the industry average.
Compared to an average S&P500 Price/Forward Earnings ratio of 21.90, WSM is valued at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.61 | ||
| Fwd PE | 18.95 |
4.2 Price Multiples
WSM's Enterprise Value to EBITDA ratio is in line with the industry average.
Based on the Price/Free Cash Flow ratio, WSM is valued a bit cheaper than the industry average as 70.25% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 21.05 | ||
| EV/EBITDA | 12.45 |
4.3 Compensation for Growth
The excellent profitability rating of WSM may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)0.67
EPS Next 2Y2.38%
EPS Next 3Y4.57%
5. Dividend
5.1 Amount
WSM has a Yearly Dividend Yield of 1.63%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 5.27, WSM pays a bit more dividend than its industry peers.
Compared to the average S&P500 Dividend Yield of 2.42, WSM is paying slightly less dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.63% |
5.2 History
The dividend of WSM has a limited annual growth rate of 2.89%.
WSM has paid a dividend for at least 10 years, which is a reliable track record.
WSM has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)2.89%
Div Incr Years18
Div Non Decr Years18
5.3 Sustainability
26.76% of the earnings are spent on dividend by WSM. This is a low number and sustainable payout ratio.
The dividend of WSM is growing, but earnings are growing more, so the dividend growth is sustainable.
DP26.76%
EPS Next 2Y2.38%
EPS Next 3Y4.57%
173.19
+0.01 (+0.01%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Discretionary Distribution & Retail
GICS IndustrySpecialty Retail
Earnings (Last)
Earnings (Next)
Inst Owners92.08%
Inst Owner Change-0.92%
Ins Owners0.4%
Ins Owner Change3.25%
Market Cap21.30B
Analysts70
Price Target183.24 (5.8%)
Short Float %4.84%
Short Ratio3.2
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.63% |
Yearly Dividend2.23
Dividend Growth(5Y)2.89%
DP26.76%
Div Incr Years18
Div Non Decr Years18
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)7.27%
Min EPS beat(2)4.18%
Max EPS beat(2)10.37%
EPS beat(4)4
Avg EPS beat(4)7.84%
Min EPS beat(4)4.18%
Max EPS beat(4)10.37%
EPS beat(8)8
Avg EPS beat(8)10.86%
EPS beat(12)9
Avg EPS beat(12)7.83%
EPS beat(16)13
Avg EPS beat(16)9.55%
Revenue beat(2)2
Avg Revenue beat(2)3.12%
Min Revenue beat(2)2.74%
Max Revenue beat(2)3.5%
Revenue beat(4)2
Avg Revenue beat(4)0.91%
Min Revenue beat(4)-2.17%
Max Revenue beat(4)3.5%
Revenue beat(8)3
Avg Revenue beat(8)-0.86%
Revenue beat(12)5
Avg Revenue beat(12)-0.92%
Revenue beat(16)8
Avg Revenue beat(16)-0.15%
PT rev (1m)0.25%
PT rev (3m)-3.39%
EPS NQ rev (1m)-0.09%
EPS NQ rev (3m)-0.83%
EPS NY rev (1m)1.02%
EPS NY rev (3m)0.34%
Revenue NQ rev (1m)0.55%
Revenue NQ rev (3m)0.71%
Revenue NY rev (1m)0.81%
Revenue NY rev (3m)1.47%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.61 | ||
| Fwd PE | 18.95 | ||
| P/S | 2.74 | ||
| P/FCF | 21.05 | ||
| P/OCF | 17.01 | ||
| P/B | 9.86 | ||
| P/tB | 10.22 | ||
| EV/EBITDA | 12.45 |
EPS(TTM)8.83
EY5.1%
EPS(NY)9.14
Fwd EY5.28%
FCF(TTM)8.23
FCFY4.75%
OCF(TTM)10.18
OCFY5.88%
SpS63.27
BVpS17.57
TBVpS16.94
PEG (NY)N/A
PEG (5Y)0.67
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 21.15% | ||
| ROE | 50.47% | ||
| ROCE | 40.67% | ||
| ROIC | 30.57% | ||
| ROICexc | 43.97% | ||
| ROICexgc | 45.44% | ||
| OM | 17.95% | ||
| PM (TTM) | 14.02% | ||
| GM | 45.57% | ||
| FCFM | 13.01% |
ROA(3y)21.14%
ROA(5y)20.48%
ROE(3y)54.49%
ROE(5y)54.47%
ROIC(3y)32.3%
ROIC(5y)31.62%
ROICexc(3y)45.42%
ROICexc(5y)45.62%
ROICexgc(3y)47.01%
ROICexgc(5y)47.4%
ROCE(3y)42.97%
ROCE(5y)42.71%
ROICexcg growth 3Y-3.39%
ROICexcg growth 5Y23.09%
ROICexc growth 3Y-3.15%
ROICexc growth 5Y23.27%
OM growth 3Y1.81%
OM growth 5Y18.68%
PM growth 3Y2.23%
PM growth 5Y19.3%
GM growth 3Y1.79%
GM growth 5Y5.07%
F-Score8
Asset Turnover1.51
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Debt/EBITDA | 0 | ||
| Cap/Depr | 104.84% | ||
| Cap/Sales | 3.09% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 77.01% | ||
| Profit Quality | 92.78% | ||
| Current Ratio | 1.51 | ||
| Quick Ratio | 0.73 | ||
| Altman-Z | 7.32 |
F-Score8
WACC9.48%
ROIC/WACC3.22
Cap/Depr(3y)114.25%
Cap/Depr(5y)109.62%
Cap/Sales(3y)3.13%
Cap/Sales(5y)2.93%
Profit Quality(3y)106.74%
Profit Quality(5y)116.84%
High Growth Momentum
Growth
EPS 1Y (TTM)12.48%
EPS 3Y5.36%
EPS 5Y29.28%
EPS Q2Q%6.32%
EPS Next Y-0.92%
EPS Next 2Y2.38%
EPS Next 3Y4.57%
EPS Next 5Y7.32%
Revenue 1Y (TTM)1.64%
Revenue growth 3Y-2.21%
Revenue growth 5Y5.51%
Sales Q2Q%4.2%
Revenue Next Year1.82%
Revenue Next 2Y2.45%
Revenue Next 3Y2.93%
Revenue Next 5Y3.52%
EBIT growth 1Y2.08%
EBIT growth 3Y-0.44%
EBIT growth 5Y25.22%
EBIT Next Year13.98%
EBIT Next 3Y7.55%
EBIT Next 5Y6.2%
FCF growth 1Y15.28%
FCF growth 3Y-0.17%
FCF growth 5Y22.02%
OCF growth 1Y3.43%
OCF growth 3Y-0.27%
OCF growth 5Y17.5%