08:26 AM EDT, 08/23/2024 (MT Newswires) -- Williams-Sonoma's ( WSM ) period of substantial gross margin improvements is 'likely over,' though it still has room for expansion, and its H2 outlook is 'achievable,' Wedbush said in a note to clients Friday.

Wedbush said despite Williams-Sonoma's ( WSM ) Q2 expectations miss, the analysts expect around 90 basis points for growth in H2, and note the company is 'taking a more conservative view on the estimated lift' in H2 from new initiatives. However, the company's revised fiscal year 2024 revenue guidance implies H2 revenue down 3% to up 1%, 'much worse than consensus' of an increase of 3% and Webush's prior expectation of H2 revenue up 5%.

Still, Wedbush said it remains positive on Williams-Sonoma ( WSM ) due to the company's market share initiatives and potential margin leverage when volumes recover.

Wedbush reduced its target price for Williams-Sonoma ( WSM ) to $150 from $175, while reiterating its Outperform rating.

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