Williams-Sonoma Named Top Home Retail Pick by Gordon Haskett on Strong Q2 Results

Gordon Haskett has named Williams-Sonoma (NYSE: WSM) its top pick among home-focused retailers, citing the company's strong second-quarter performance and an upgraded financial outlook that suggests continued outperformance in a challenging industry.

Analyst's Take

In a research note, Gordon Haskett analysts maintained a Buy rating on Williams-Sonoma stock with a price target of $260. The firm's valuation is based on approximately 24 times its fiscal 2027 earnings per share (EPS) estimate of $10.75.

The analysts' constructive view is underpinned by several factors, including the retailer's exposure to more resilient middle-to-upper income consumers and its diverse brand portfolio. They also highlighted the strength of the company's business-to-business segment, which grew 14.5% year-over-year in the second quarter, and a "promotion-light" strategy that supports profitability.

Strong Q2 Performance

The endorsement follows Williams-Sonoma's robust second-quarter fiscal 2026 results, reported on August 26. The company demonstrated significant outperformance against both analyst and consensus expectations.

Key performance indicators from the quarter include:

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• Same-store sales growth of 6.2%, surpassing Gordon Haskett's estimate of 3.6% and the consensus forecast of 4.6%.
• Operating margin of 17.3% (excluding tariff refunds), which was ahead of the firm's 16.4% and consensus 17.0% estimates.
• Revenue of $1.96 billion and earnings of $2.10 per share, both beating expectations.

According to the report, the outperformance was broad-based across all four of the company's banners, with its two-year stacked sales accelerating by approximately 170 basis points.

Raised Full-Year Guidance

In response to its strong performance, Williams-Sonoma raised its full-year guidance for fiscal 2026. The company now anticipates same-store sales growth between 4.0% and 6.5%, up from a previous range of 2.0% to 6.0%.

The operating margin forecast was also increased to a range of 17.8% to 18.2%. Looking further ahead, Gordon Haskett projects that a combination of new unit growth and the easing of tariff pressures could translate into 10-15% EPS growth in fiscal 2027. The positive results also prompted other Wall Street firms, including Telsey and Jefferies, to raise their price targets on the stock.