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Research Alert: CFRA Moves To Hold From Sell On Shares Of Williams-sonoma, Inc.

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CFRA, an independent research provider, has providedwith the following research alert. Analysts at CFRA have summarized their opinion as follows:

We raise our 12-month target from $170 to $202, 22x our revised FY 27 (Jan.) EPS estimate of $9.20 (previously $9.15). This premium valuation, above its 18x three-year mean, is justified by WSM's strong execution, pricing power with its affluent consumer, and diversified portfolio. However, we see a balanced risk/reward profile as potential headwinds from rising transportation costs and an ambiguous interest rate outlook temper our enthusiasm. Positively, management's conservative guidance, which already assumes extended tariffs and no housing recovery, coupled with WSM's track record of beating expectations, provides a floor for performance. Furthermore, WSM's cash flow should support continued dividend growth and share repurchases, providing a buffer for any bottom-line softness. Given this balanced view, we adjust our FY 28 EPS estimate to $9.91 (from $10.03) and see shares fairly valued at current levels. In order to be more constructive, we would like to see less ambiguity in the interest rate outlook.

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