Williams-Sonoma "Furnishes" Earnings Wed 8/28 After Hours
Updated: Oct 19, 2020
Williams-Sonoma, headquartered in San Francisco, California, is an American retail company specializing in kitchenware and home furnishings. It's certainly made it's mark as one of the largest e-commerce retailers in the U.S., and one of the biggest multi-channel specialty retailers in the world.
But enough with all that boring stuff, what are we in for with earnings this Wednesday?
To get an idea let's consider what we already know —
Consensus EPS Estimate is $0.83 (+7.8% YoY)
Consensus Revenue Estimate is $1.31B (+2.3% YoY)
Last four EPS have all been beats for an avg +9.5% surprise.
Last three of four Revenues have been beats for an avg +0.92% surprise.
EPS Revisions for the past 90 days include 11 upgrades and 4 downgrades.
Current Technicals are trending from buy to strong buy.
That's a pretty solid track record and setup, and normally would be a bullish indicator for what to expect, but one also has to consider how the imminent China Tariffs will affect the sentiment toward earnings, beat or no. Williams-Sonoma themselves had indicated in April of this year that it was "prepared for the worst", reportedly taking measures to move production out of China, negotiate better pricing with suppliers, and bring its upholstery work to the U.S. It was also indicated as recent as June that WSM will effectively halve China sourcing in 2020.
So WSM does appear to be aware of its trade war vulnerability, and is actively executing to mitigate it, but the unfortunate reality is that an operation of this size and magnitude takes a great deal of time and logistics to transition properly, and it's possible such efforts would cut into revenue potentials within the upcoming report. Technicals appear to be in favor of a rally, at least for now, but it never hurts to take due precaution when trading during current market conditions. Even a high-surprise beat may be met with more conservative price-action than usual given overall market sentiment.
As always, please do your own research, and take care to use every tool in your arsenal to fend against unforeseen circumstances (stop-losses, hedges, option spreads, etc.) WSM may be a blue chip, and a typically bullish one at that, but no one can account for confounding variables such as the occasional wildcard tweet!