RBC Capital Raises Williams-Sonoma Price Target to $213 Amid Positive Outlook

RBC Capital raised its price target for Williams-Sonoma (WSM) from $212 to $213, maintaining its "Outperform" rating. The company operates in the $300 billion domestic home category and $450 billion international home market, with a focus on expanding its exposure in the B2B, marketplace, and franchise areas. The average target price for WSM is $200.96, indicating a 4.63% upside from the current price.

Title: RBC Capital Raises Price Target for Williams-Sonoma to $213

RBC Capital has raised its price target for Williams-Sonoma (WSM) to $213, maintaining an "Outperform" rating. The home furnishings retailer is currently trading at $192.17, with a market cap of $23.7 billion. The new price target represents a 10.8% increase from the previous target of $212, suggesting significant confidence in the company's future performance.

Williams-Sonoma has been performing well, with the company reporting its third consecutive quarter of positive comparable sales growth despite unchanged housing fundamentals. The company's financial health is robust, with a healthy current ratio of 1.51 and gross profit margins of 45.7%. RBC Capital's revised estimates for the third quarter now project 1.2% comparable sales growth, up from a previous estimate of 0.6%, and adjusted earnings per share of $1.80, down from $1.85.

For fiscal years 2025 and 2026, RBC Capital models comparable sales growth of 1.9% and 2.6%, respectively, compared to prior estimates of 1.7% and 2.6%. The new price target is based on approximately 23 times RBC’s revised 2026 adjusted earnings per share estimate of $9.24, equating to about 21 times its 2027 adjusted earnings per share estimate of $10.19.

Williams-Sonoma's recent earnings report for the second quarter of 2025 highlighted strong financial results, with a net revenue of $1.84 billion and a nearly 20% increase in diluted earnings per share to $2.00. The company also noted a 17.7% increase in merchandise inventories to $1.4 billion, including a strategic pull forward of receipts to mitigate the impact of higher tariffs in fiscal 2025.

The company's positive outlook is partly due to the rebound in the furniture market, as indicated by Williams-Sonoma's boosted sales outlook. The company expects full-year comparable-store sales to increase by 2% to 5%, up from its earlier projection of a range from flat performance to 3% growth. Additionally, Williams-Sonoma anticipates its 2025 revenue to increase by 0.5% to 3.5%, up from its previous forecast of between a 1.5% decline and a 1.5% rise.

Williams-Sonoma's stock has risen 5.8% in 2025, while the S&P 500 has gained about 10.1%. Despite the positive outlook, the company noted that tariff uncertainties could cause it to change its performance forecast.

References:
[1] https://www.investing.com/news/analyst-ratings/williamssonoma-stock-price-target-raised-to-213-from-212-at-rbc-capital-93CH-4214364
[2] https://www.morningstar.com/news/marketwatch/20250827176/williams-sonoma-offers-latest-signal-of-a-rebounding-furniture-market