WSM
Williams-Sonoma, Inc.
$223.54
Stable Earnings Power
80%
P/Adj-EPS × Normalized Multiple
Moderate
·
Conviction
Overvalued
Trading 36.5% above fair value
You pay
$223.54
Bear
$143.31
Fair
$163.79
Bull
$184.26
Bear
$143.31
-35.9%
$8.84 × 14x P/E
Fair
$163.79
-26.7%
$8.84 × 16x P/E
Bull
$184.26
-17.6%
$8.84 × 18x P/E
Key Value Driver
Normalized P/E multiple (16x base case)
Implied Market Multiple
25.3x
Summary
Our base-case estimate uses a valuation based on adjusted earnings per share and a normalized price-to-earnings multiple. We then blend that result with the average analyst price target of $205.29 from 56 analysts, using a 35% weight on analyst consensus. That produces an estimated intrinsic value of $163.79 per share.
Warnings
Wall Street's average price target is $205.29 (from 56 analysts). Our estimate is 31% below the consensus -- consider that gap carefully.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples