Builders have been unable to construct new homes quickly enough to meet demand. A surge in lumber prices earlier this year didn’t help.
But Alber wasn’t just talking about renters looking to flee the cities for the suburbs as a positive for Williams-Sonoma, which also owns furniture retailers West Elm and Pottery Barn. She added during the call that “there’s a lot of people who are out looking for second homes and even if they can’t afford it themselves, pulling the resources together with friends to complete that fantasy of buying a get away home.”
Alber cited estimates that show “home sales in 2021 are expected to grow more than 20%, the most sales recorded since 2005.” Of course, that was just before the last housing bubble burst. But Alber doesn’t seem concerned about the housing market succumbing to a similar fate anytime soon.
“The acceptance of remote work is gaining traction with a number of remote hybrid workers expected to nearly double in five years from pre-Covid metrics,” she said during the call. “This is a really, really important trend that I don’t think is going to be transient. I think it’s one that will continue to last for a long time.”
Investors seem to be buying into Alber’s optimism too. Shares of Williams-Sonoma surged 10% Thursday to a new record high. Ten Wall Street analysts raised their price target on the stock following the earnings report.
Williams-Sonoma said that sales grew more than 30% in the second quarter. The company also boosted its outlook for 2021 as well as the next few years. In yet more signs of confidence, Williams-Sonoma raised its dividend by 20% and issued a new stock buyback program as well.