Williams-Sonoma (WSM) Stock Forecast & Price Target

Williams-Sonoma is viewed favorably because it is taking share across a large and fragmented home market, with 2Q comparable brand revenue up 6.2% and sales of $1.96B, while all major banners and channels posted positive comps and emerging businesses plus B2B grew in double digits. Its operating model is proving resilient despite tariff and macro pressure: 2Q adjusted EPS rose to $2.10, margin headwinds are expected to moderate in 2H, and 2026 guidance was raised to 4.7%-7.2% revenue growth with 4.3%-9.1% implied EPS growth and 17.8%-18.2% operating margin. The outlook is further supported by strong AI monetization, e-commerce investment, and a robust B2B runway, including $317M of B2B sales and management’s belief that B2B could become a $2B opportunity.

Williams-Sonoma is facing a weakening fundamental backdrop as higher 10-year Treasury yields at 4.65% and rising mortgage rates since March are likely to keep housing turnover and home-related spending sluggish through the rest of 2026. Its latest margins also show pressure, with gross margin excluding tariff refunds down 160 bps year over year to 45.5% as 230 bps of merchandise margin compression from peak tariff effects outweighed supply chain and occupancy leverage. Even with share gains and exposure across a large home market, its outlook is constrained by stagnant housing, volatile macro conditions, and the risk that consumers shift spending toward services and entertainment instead of discretionary home goods.