By Dhirendra Tripathi
Investing.com – Williams-Sonoma (NYSE:WSM) stock climbed 7% in premarket Thursday after the retailer’s fourth-quarter earnings beat estimates, overcoming capacity and supply chain limitations, and labor shortages.
Compounding the gains in the stock is a 10% increase in quarterly dividend and plans for a new $1.5 billion stock repurchase, superseding the around $750 million remaining under the previous exercise.
Revenue in the fourth quarter rose 9% to $2.5 billion as demand for home furnishings stayed elevated.
Comparable brand revenue growth was about 11%, with most brands growing -- West Elm at over 18% and Pottery Barn more than 16%. Williams Sonoma grew 4.5%, while Pottery Barn Kids and Teen fell 6.1%.
The company also managed to grow its operating margins. They rose by 3.1 percentage points on an adjusted basis, helped by cost controls at a time of surging costs. The company has its own in-house design capabilities.
Adjusted profit per share rose 37% to $5.42.
Williams-Sonoma is now planning for 2022 in line with its long-term guidance of mid-to-high single digit annual net revenue growth, increasing revenue to $10 billion by financial year 2024, and operating margins around 17.6% notched in 2021.
The company said liquidity remains strong at $850 million in cash, and over $1 billion in operating cash flow.