Tags: Williams Sonoma | direct | sales | WSM

Williams-Sonoma Goes Direct for Sales

By    |   Wednesday, 26 Oct 2011 10:38 AM

Specialty retailer Williams-Sonoma (WSM) continues to put up attractive year-over-year profit growth numbers, and the company generates a greater portion of sales catalog and e-commerce sales than some of the company's major competitors. That said, over the last year the share price has appreciated slightly while the stock values of competitors Bed Bath & Beyond (BBBY) and Pier One Imports (PIR) have gained close to 40 percent.

Williams-Sonoma owns and operates the Williams-Sonoma, Pottery Barn, Pottery Barn Kids and West Elm brands. All of the brands sell products through both retail stores and direct to consumer channels. The company has a total of approximately 600 stores across all brands. The direct to consumer channel accounts for just under half of company revenues.

For the second quarter of 2011, Williams-Sonoma's revenues increased 5 percent to $815 million, up from $775 million in Q2 of 2010. Net income increased 19 percent to 37 cents per share, from 28 cents.

First quarter earnings were also 37 cents per share and the third quarter consensus estimate is 38 cents. For the fourth quarter, the company is forecast to earn $1.18 per share. Half of the company's profits are generated in the fourth quarter of each year.

Brick and mortar

In the 2011 second quarter, the direct to consumer channel generated 45 percent of revenues, up three percentage points from a year earlier. The direct sales definitely pay better, with earnings before tax (EBT) of 22.6 percent of sales compared to an EBT of 7.7 percent on retail store revenues.

When corporate expenses are figured in, the company's overall EBT percentage for the second quarter was 8 percent of sales, up 80 basis points from a year earlier due to the increased portion of e-commerce sales. The company is currently in the process of launching international sales and shipping across the different web sites to enhance the e-commerce growth rates.

Recently, the analysts at BB&T Capital Markets upgraded WSM to a buy from the previous hold rating. In August, Barclays Capital analysts downgraded the stock to equal weight from overweight.

The company reports next on Nov. 17.

© 2017 Newsmax Finance. All rights reserved.

   
1Like our page
2Share
Companies
Specialty retailer Williams-Sonoma (WSM) continues to put up attractive year-over-year profit growth numbers, and the company generates a greater portion of sales catalog and e-commerce sales than some of the company's major competitors. That said, over the last year the...
Williams Sonoma,direct,sales,WSM
352
2011-38-26
Wednesday, 26 Oct 2011 10:38 AM
Newsmax Inc.
 

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

NEWSMAX.COM
MONEYNEWS.COM
© Newsmax Media, Inc.
All Rights Reserved