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Is Williams-Sonoma, Inc. (WSM) Stock Trading Below Fair Value?

Wednesday, January 19, 2022 03:25 PM | InvestorsObserver Analysts
Is Williams-Sonoma, Inc. (WSM) Stock Trading Below Fair Value?

Williams-Sonoma, Inc. (WSM) receives a strong valuation ranking of 91 from InvestorsObserver data analysis. The proprietary ranking system focuses on the underlying health of a company through analysis of its stock price, earnings, and growth rate. WSM has a better value than 91% of stocks based on these valuation analytics. Investors primarily focused on buy-and-hold strategies will find the valuation ranking relevant to their goals when making investment decisions.

Valuation Rank - 91
WSM gets a 91 Valuation Rank today. Find out what this means to you and get the rest of the rankings on WSM!

Metrics Analysis

WSM's trailing-12-month Price to Earnings (PE) ratio of 11 puts it around the historical average of roughly 15. WSM is a average value at its current trading price as investors are paying around what its worth in relation to the company's earnings. WSM's trailing-12-month earnings per share (EPS) of 13.30 does justify what it is currently trading at in the market. Trailing PE ratios, however, do not factor in a company's projected growth rate, resulting in some firms having high PE ratios due to high growth potentially enticing investors even if current earnings are low. WSM's 12-month-forward PE to Growth (PEG) ratio of 1.14 is considered a roughly average value as the market is valuing WSM right in line with its projected earnings growth. WSM's PEG comes from its forward price to earnings ratio being divided by its growth rate. A PEG ratio of 1 represents a perfect correlation between earnings growth and share price. Due to their incorporation of more fundamentals of a company's overall health and focusing on the future rather than the past, PEG ratios are one of the most used valuation metrics by analysts today.


All together these valuation metrics paint a pretty adequate picture for WSM at its current price due to a fairly valued PEG ratio due to strong growth. The PE and PEG for WSM are around the average of the market resulting in a valuation score of 91. Click Here to get the full Report on Williams-Sonoma, Inc. (WSM) stock.

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