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In the last reported quarter, the company’s earnings beat the Zacks Consensus Estimate by 9.5% but decreased by 24.6% year over year. Revenues of this multi-channel specialty retailer of premium-quality home products lagged the consensus mark by 1.7% and declined by 7.2%.
Williams-Sonoma reported better-than-expected earnings in three of the last four quarters, the average being 4.7%.
Trend in Estimate Revision
For the quarter to be reported, the Zacks Consensus Estimate for earnings per share has remained unchanged at $2.76 over the past 60 days. That said, the estimated figure indicates a fall of 28.7% from $3.87 per share reported in the year-ago quarter. The consensus mark for revenues is pegged at $1.97 billion, suggesting a 7.8% decline from the year-ago figure of $2.14 billion.
Slowing discretionary demand conditions, a slow macroeconomic (particularly housing) outlook and excess inventory in the industry are expected to have weighed on WSM’s fiscal second-quarter results. Softening category demand, owing to inflationary pressure and macro and geopolitical concerns, has been weighing on consumers’ capacity to spend on discretionary products.
However, strength across all brands, along with rising e-commerce growth, accelerating growth initiatives and operational improvements, are expected to have somewhat contributed to Williams-Sonoma’s net sales in second-quarter fiscal 2023. The accelerating trend in online sales is also expected to have aided its top line in the yet-to-be-reported quarter.
The multi-channel, multi-brand platform, strong e-commerce growth, solid execution of strategic initiatives, digital leadership, product innovation, retail transformation and operational excellence across businesses are also expected to have supported the top line. Also, cross-brand initiatives are expected to have positively contributed to consolidated comps to some extent.
However, higher input costs and increased expenses for ocean freight, detention and demurrage due to supply-chain disruptions and global inflation pressures are likely to have weighed on its to-be-reported quarterly performance.
We expect Pottery Barn Kids and Teen’s comps growth to be at negative 4%. The same had grown 5.3% a year ago. In first-quarter fiscal 2023, comps were negative 3.3%.
Our model predicts Pottery Barn’s comps to decline 3.5% year over year. The same improved 21.5% a year ago. In first-quarter fiscal 2023, comps were negative 0.4%.
Our model predicts West Elm’s comps to decline 12%. The metric witnessed 6.1% growth a year ago but declined 15.8% in the last reported quarter.
We expect the namesake brand’s comps to be down 5%. The metric witnessed 0.5% growth a year ago and negative 4.4% in the previously-reported quarter.
What the Zacks Model Says
Our proven model does not predict an earnings beat for Williams-Sonoma this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. This is not the case here, as elaborated below.
Earnings ESP: Williams-Sonoma has an earnings ESP is -0.65%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Williams-Sonoma currently carries a Zacks Rank #4 (Sell).
Restaurant Brands International, Inc. (QSR - Free Report) reported impressive second-quarter 2023 results, with earnings and revenues surpassing the Zacks Consensus Estimate. The top and bottom lines increased on a year-over-year basis. The upside was primarily driven by strong global comparable sales, unit growth and a healthy balance of traffic and check.
During the quarter, QSR reported an adjusted EPS of 85 cents, surpassing the Zacks Consensus Estimate of 76 cents. The bottom line increased 3.7% from an adjusted EPS of 82 cents reported in the prior-year quarter. Quarterly net revenues of $1,775 million surpassed the consensus mark of $1,746 million. The top line increased 8.3% on a year-over-year basis. The upside was driven by a rise in system-wide sales at Tim Hortons, Burger King, Popeyes and Firehouse Subs. However, this was partially offset by unfavorable FX movements.
The Cheesecake Factory Incorporated (CAKE - Free Report) reported second-quarter fiscal 2023 results, wherein earnings beat the Zacks Consensus Estimate but revenues missed the same. The top and bottom lines increased year over year. An increase in comparable restaurant sales backed by improving consumer demand and new restaurant openings drove the company’s performance.
During the quarter, CAKE reported an adjusted EPS of 88 cents, beating the Zacks Consensus Estimate of 81 cents by 8.6%. The reported figure represented a 69.2% year-over-year increase. Total revenues of $866.2 million missed the consensus estimate of $881 million by 1.7%. However, the top line increased 4% on a year-over-year basis.
Chipotle Mexican Grill, Inc. (CMG - Free Report) released mixed second-quarter fiscal 2023 results, with earnings beating the Zacks Consensus Estimate and revenues missing the same. The top and bottom lines increased on a year-over-year basis.
During the quarter, Chipotle reported an adjusted EPS of $12.65, beating the Zacks Consensus Estimate of $12.25. The bottom line increased 36% from $9.30 reported in the year-ago quarter. Quarterly revenues of $2,514.8 million missed the consensus mark of $2,524 million. The top line increased 13.6% on a year-over-year basis. The upside can primarily be attributed to strong comparable restaurant sales growth and new restaurant openings.
Image: Bigstock
Williams-Sonoma (WSM) to Post Q2 Earnings: What's in Store?
Williams-Sonoma, Inc. (WSM - Free Report) is scheduled to release second-quarter fiscal 2023 results on Aug 23, before market open.
In the last reported quarter, the company’s earnings beat the Zacks Consensus Estimate by 9.5% but decreased by 24.6% year over year. Revenues of this multi-channel specialty retailer of premium-quality home products lagged the consensus mark by 1.7% and declined by 7.2%.
Williams-Sonoma reported better-than-expected earnings in three of the last four quarters, the average being 4.7%.
Trend in Estimate Revision
For the quarter to be reported, the Zacks Consensus Estimate for earnings per share has remained unchanged at $2.76 over the past 60 days. That said, the estimated figure indicates a fall of 28.7% from $3.87 per share reported in the year-ago quarter. The consensus mark for revenues is pegged at $1.97 billion, suggesting a 7.8% decline from the year-ago figure of $2.14 billion.
Williams-Sonoma, Inc. Price and EPS Surprise
Williams-Sonoma, Inc. price-eps-surprise | Williams-Sonoma, Inc. Quote
Factors to Note
Slowing discretionary demand conditions, a slow macroeconomic (particularly housing) outlook and excess inventory in the industry are expected to have weighed on WSM’s fiscal second-quarter results. Softening category demand, owing to inflationary pressure and macro and geopolitical concerns, has been weighing on consumers’ capacity to spend on discretionary products.
However, strength across all brands, along with rising e-commerce growth, accelerating growth initiatives and operational improvements, are expected to have somewhat contributed to Williams-Sonoma’s net sales in second-quarter fiscal 2023. The accelerating trend in online sales is also expected to have aided its top line in the yet-to-be-reported quarter.
The multi-channel, multi-brand platform, strong e-commerce growth, solid execution of strategic initiatives, digital leadership, product innovation, retail transformation and operational excellence across businesses are also expected to have supported the top line. Also, cross-brand initiatives are expected to have positively contributed to consolidated comps to some extent.
However, higher input costs and increased expenses for ocean freight, detention and demurrage due to supply-chain disruptions and global inflation pressures are likely to have weighed on its to-be-reported quarterly performance.
We expect Pottery Barn Kids and Teen’s comps growth to be at negative 4%. The same had grown 5.3% a year ago. In first-quarter fiscal 2023, comps were negative 3.3%.
Our model predicts Pottery Barn’s comps to decline 3.5% year over year. The same improved 21.5% a year ago. In first-quarter fiscal 2023, comps were negative 0.4%.
Our model predicts West Elm’s comps to decline 12%. The metric witnessed 6.1% growth a year ago but declined 15.8% in the last reported quarter.
We expect the namesake brand’s comps to be down 5%. The metric witnessed 0.5% growth a year ago and negative 4.4% in the previously-reported quarter.
What the Zacks Model Says
Our proven model does not predict an earnings beat for Williams-Sonoma this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. This is not the case here, as elaborated below.
Earnings ESP: Williams-Sonoma has an earnings ESP is -0.65%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: Williams-Sonoma currently carries a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank stocks here.
Recent Retail-Wholesale Releases
Restaurant Brands International, Inc. (QSR - Free Report) reported impressive second-quarter 2023 results, with earnings and revenues surpassing the Zacks Consensus Estimate. The top and bottom lines increased on a year-over-year basis. The upside was primarily driven by strong global comparable sales, unit growth and a healthy balance of traffic and check.
During the quarter, QSR reported an adjusted EPS of 85 cents, surpassing the Zacks Consensus Estimate of 76 cents. The bottom line increased 3.7% from an adjusted EPS of 82 cents reported in the prior-year quarter. Quarterly net revenues of $1,775 million surpassed the consensus mark of $1,746 million. The top line increased 8.3% on a year-over-year basis. The upside was driven by a rise in system-wide sales at Tim Hortons, Burger King, Popeyes and Firehouse Subs. However, this was partially offset by unfavorable FX movements.
The Cheesecake Factory Incorporated (CAKE - Free Report) reported second-quarter fiscal 2023 results, wherein earnings beat the Zacks Consensus Estimate but revenues missed the same. The top and bottom lines increased year over year. An increase in comparable restaurant sales backed by improving consumer demand and new restaurant openings drove the company’s performance.
During the quarter, CAKE reported an adjusted EPS of 88 cents, beating the Zacks Consensus Estimate of 81 cents by 8.6%. The reported figure represented a 69.2% year-over-year increase. Total revenues of $866.2 million missed the consensus estimate of $881 million by 1.7%. However, the top line increased 4% on a year-over-year basis.
Chipotle Mexican Grill, Inc. (CMG - Free Report) released mixed second-quarter fiscal 2023 results, with earnings beating the Zacks Consensus Estimate and revenues missing the same. The top and bottom lines increased on a year-over-year basis.
During the quarter, Chipotle reported an adjusted EPS of $12.65, beating the Zacks Consensus Estimate of $12.25. The bottom line increased 36% from $9.30 reported in the year-ago quarter. Quarterly revenues of $2,514.8 million missed the consensus mark of $2,524 million. The top line increased 13.6% on a year-over-year basis. The upside can primarily be attributed to strong comparable restaurant sales growth and new restaurant openings.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.