Williams-Sonoma (WSM:NYS) Fundamental Valuation Report

Williams-Sonoma (WSM:NYS) Fundamental Valuation Report

Fundamental Valuation Report


Consumer Cyclical:Specialty Retail

This Report was generated using the valuation tools available on StockCalc.com. For a free 30 day trial click here.

Close Price/Date
$186.89 (USD) 04/06/2021

Weighted Valuation
$174.75 (USD)

Overall Rating
Overvalued by 6.5%

Valuation Models Comparables: $174.75 (USD)
Valuation Methods This company is:
Cash Flow: Overvalued on a Cash Flow Valuation
Comparable Company: Overvalued on a Comparable Valuation
Asset: Overvalued on an Asset Valuation
According to Analyst consensus at $131.50 this stock is Overvalued

Company Overview (WSM:NYS USD)

Price 186.89
Range 181.82 – 188.23
52 week 47.66 – 186.89
Open 181.99
Vol / Avg. 1.33M/2.08M
Mkt cap 13.87B
P/E 21.15
Div/yield 2.02/0.01
EPS 8.61
Shares 76.19M
Beta 1.70

Company Description

With a wide retail and direct-to-consumer presence, Williams-Sonoma is a leader in the $112 billion domestic home furnishings category. Namesake Williams-Sonoma (198 stores) offers high-end cooking essentials, while Pottery Barn (195) provides casual home accessories. Brand extensions include Pottery Barn Kids (57) and PBteen. West Elm (121) is an emerging concept for young professionals, and Rejuvenation (10) offers lighting and house parts. Williams-Sonoma also has a business-to-business team that supports projects that range from residential to large-scale commercial.

Valuation Details

 We have up to 6 valuation points for each company. Details are at the bottom of the report.

Discounted Cash Flow and Sensitivity Analysis for WSM:NYS

Using a discounted cash flow model we generated an intrinsic value of $96.74 (USD) for WSM:NYS

Sensitivity Analysis

(showing how changes in the input variables impact the DCF calculation)

WSM:NYS Current Values Valuation If Dropped * Valuation If Raised *
Calculated Value: $96.74 1% 5% 1% 5%
WACC (or Ke) 9.70 $113.74 $84.15
Terminal Growth Rate 3.00 $85.59 $111.81
Tax Rate 0.24 $104.22 $89.26
Cash Flow 938,742,000 $90.18 $103.30
Capital Expenditures -186,603,400 $95.58 $97.90
Long Term Debt 125,000,000 $96.82 $96.66

* Changes are absolute: ex WACC from 8% to 7%

Comparables Model

Using similar companies and price based ratios we generated a valuation of $174.75 (USD) for WSM:NYS. We also generated a valuation of $182.41 (USD) using other metrics and comparables.
The comparable companies were Stitch Fix (SFIX:NAS), National Vision Holdings (EYE:NAS), Michaels Companies (MIK:NAS), Murphy USA (MUSA:NYS) and Five Below (FIVE:NAS).

Company WSM:NYS End Date Value
Earnings/Share $8.61 (USD)
Book Value/Share $21.67 (USD)
Sales/Share $85.80 (USD)
Cash Flow/Share $16.13 (USD)
EBITDA/Share $13.91 (USD)
Price Based on Comps Adjustment Factor (%)
$469.65 (USD) -43.8
$186.01 (USD) -40.7
$203.56 (USD) -47.0
$210.15 (USD) -30.5
$325.19 (USD) -24.1
21.71 PE Ratio 54.55 0.00 106.34 11.10 11.01 89.74
8.62 PB Ratio 8.58 12.65 4.20 0.00 4.96 12.53
2.18 PS Ratio 2.37 2.96 2.26 0.62 0.38 5.64
11.59 PCF Ratio 115.44 520.27 16.49 2.67 7.54 30.24
13.26 EV to EBITDA 23.38 0.00 25.06 9.51 6.55 52.42


Using a multiples approach we generated a valuation of  $109.98 (USD) for WSM:NYS

Company WSM:NYS End Date Value
Earnings/Share $8.61 (USD)
Book Value/Share $21.67 (USD)
Sales/Share $85.80 (USD)
Cash Flow/Share $16.13 (USD)
EBITDA/Share $13.91 (USD)
Price Based on Comps Adjustment Factor
$135.63 (USD) 0
$89.62 (USD) 0
$78.71 (USD) 0
$139.26 (USD) 0
$106.70 (USD) 0
Ratios Ratio Average
PE Ratio 15.75
PB Ratio 4.14
PS Ratio 0.92
PCF Ratio 8.64
EV to EBITDA 7.67

Adjusted Book Value versus Historical Price to Book

The average the Price to Book ratio for  WSM:NYS for the last 10 years was  4.35

We ran the Adjusted Book Value for  WSM:NYS and generated a book value of  $21.63 (USD)
By multiplying these we get an adjusted valuation of  $94.15 (USD)

Analyst Data

In the Stockcalc database there are 4 analysts that provide a valuation for WSM:NYS. The 4 analysts have a concensus valuation for WSM:NYS for 2022 of $131.50 (USD).

WSM:NYS Williams-Sonoma

Analyst Recommendation
Buy Hold Sell Rating
(of 5)
Guidance As Of
1 2 2 2.5000 Underperform 2021-4-5

Current Price: 186.89 USD

Analyst Consensus
USD Millions 2022 2023 2024
Mean EPS 8.67 8.87 7.78
# EPS Analysts 6 6 2
Mean Revenue 6,836.70 6,911.70 6,678.60
# Revenue Analysts 5 5 2
Mean Target Price 131.50
Mean Cash Flow 9.30 11.08 10.27
Mean EBITDA 1,070.90 1,039.50 911.40
Mean Net Income 658.70 653.30 581.70
Mean Debt Outstanding 316.80 134.00 -1,125.20
Mean Tax Rate 23.75 23.75 24.00
Mean Growth Rate 8.79
Mean Capital Expenditure 227.00 193.10 199.80

Explanation of Valuation Models

We have up to 6 valuation points for each company in the database.

The Discounted Cash Flow (DCF) valuation is a cash flow model where cash flow projections are discounted back to the present to calculate value per share. DCF is a common valuation technique especially for companies undergoing irregular cash flows such as resource companies (mining, forestry, oil and gas) going though price cycles or smaller companies about to generate cash flow (junior exploration companies, junior pharma, technology firms…).

The Price Comparables valuation is the result of valuing the company we are looking at on the basis of ratios from selected comparable companies: Price to Earnings, Price to Book, Price to Sales, Price to Cash Flow, Enterprise Value (EV) to EBITDA. Each of these ratios for the selected comparable companies are averaged and multiplied by the values for the company we are interested in to calculate a value per share for our selected company.

We have included the Other Comparables as a way to value companies that cannot be valued using Earnings based ratios. This technique is very useful for companies still experiencing negative cash flows such as mining exploration firms. We use Cash/Share, Book Value/Share, MarketCap, 1 Year Return, NetPPE as the ratios here. Each of these ratios for the selected comparable companies are averaged and multiplied by the values for the company we are interested in to calculate a value per share for our selected company.

Multiples are similar to Price comparables where we look at current or historic ratios for the company in question to assess what it should be worth today based on those historic ratios. We use the same 5 ratios as in the price comparables and value the company with its historic averages.

With Adjusted Book Value (ABV) we calculate the book value per share for the company based on its balance sheet and multiply that book value per share by its historical price to book ratio to calculate a value per share.

If we have Analyst coverage for the company we use the consensus target price here.

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