Williams-Sonoma (NYSE: WSM) capped off a robust fiscal year with a 16% dividend hike, reflecting its sustained profitability and commitment to shareholder returns. The new quarterly dividend of $0.66 per share was announced along with earnings, and it marked the company’s 16th consecutive year of dividend increases.
In Q4 2024, comparable brand revenue rose 3.1%, and diluted EPS climbed 20.6% year over year to $3.28. For the full year, EPS reached $8.50, excluding a one-time freight adjustment, and the company posted a record operating margin of 17.9%.
Over the past five years, Williams-Sonoma has returned $4.1 billion to shareholders via buybacks and dividends, including $1.1 billion in fiscal 2024 alone. The company ended the year with $1.2 billion in cash and $1.4 billion in operating cash flow, supporting both capital returns and strategic investments.
For fiscal 2025, Williams-Sonoma expects comparable sales to be between 0% and 3%, as it faces some challenging macroeconomic conditions ahead. While the stock is down 12% year to date, its five-year return exceeds 800%, as it has been a tremendous buy for investors over the long haul.
With durable margins, disciplined capital allocation, and consistent dividend growth, Williams-Sonoma can make for a great investment if you’re looking for a top income stock to buy and hold. While it may be a tough year ahead for the company, and perhaps even beyond that, there’s some good value here for investors. The stock trades at 19 times its trailing earnings and with the recent dividend increase, it now yields 1.6%, which is above the S&P 500 average of 1.4%.
