With a retail and direct-to-consumer presence, Williams-Sonoma is a player in the $300 billion domestic home category and $450 billion international home market, focused on expanding its exposure in the B2B ($80 billion total addressable market), marketplace, and franchise areas. Namesake Williams-Sonoma (156 stores) offers high-end cooking essentials, while Pottery Barn (184) provides casual home accessories. Brand extensions include Pottery Barn Kids (45) and PBteen. West Elm (121) is an emerging concept for young professionals, and Rejuvenation (11) offers lighting and house parts. Williams-Sonoma also has a business-to-business team that supports projects that range from residential to large-scale commercial.

Dividend income is often overlooked amid gyrations in the stock market. But dividends are an important element of return. Dividend income accounted for 42% of the total return of the S&P 500 between 1930 and 2012, according to Hartford Funds. And that's just the average. In some of those decades, dividends accounted for more than 50% of total returns and even 100% of returns. More recently, dividends have accounted for a smaller portion of returns, at around 15%-20%. Not all dividends are created equal, though, and it is important to understand the difference between the two main categories: high-yield stocks and dividend-growth stocks. High-yield stocks typically have dividends that pay out in the 5%-8% range. Though the income appears attractive, the share prices of high-yield stocks may be at risk. Dividend-growth stocks typically have lower yields, often in the 1.0%-2.5% range. But the lower-yielding dividends are not likely to be a huge component of cash flow, leaving management teams with other value-additive options for deploying cash. Further, while the yields are not as high, management teams may be more likely to boost the payouts over time, as earnings grow.

Dividend income is often overlooked amid gyrations in the stock market. But dividends are an important element of return. Dividend income accounted for 42% of the total return of the S&P 500 between 1930 and 2012, according to Hartford Funds. And that's just the average. In some of those decades, dividends accounted for more than 50% of total returns and even 100% of returns. More recently, dividends have accounted for a smaller portion of returns, at around 15%-20%. Not all dividends are created equal, though, and it is important to understand the difference between the two main categories: high-yield stocks and dividend-growth stocks. High-yield stocks typically have dividends that pay out in the 5%-8% range. Though the income appears attractive, the share prices of high-yield stocks may be at risk. Dividend-growth stocks typically have lower yields, often in the 1.0%-2.5% range. But the lower-yielding dividends are not likely to be a huge component of cash flow, leaving management teams with other value-additive options for deploying cash. Further, while the yields are not as high, management teams may be more likely to boost the payouts over time, as earnings grow.

Mortgage rates near 7% are pushing prospective buyers to the sidelines and could turn housing to a drag on 2Q GDP after a strong contribution to 1Q growth. "Millions of potential homebuyers have been priced out of the market by elevated home prices and interest rates," according to The State of The Nation's Housing report, which was published yesterday by Harvard's Joint Center for Housing Studies. Fannie Mae's Home Purchase Sentiment Index for May dropped by 2.5 points to an all-time survey low of 69.4. Just 14% of consumers said that it is a good time to buy a home, down from 20% in April. Doug Duncan, Chief Economist at Fannie Mae, said "While many respondents expressed optimism at the beginning of the year that mortgage rates would decline, that simply hasn't happened, and current sentiment reflects pent-up frustration with the overall lack of purchase affordability." Based on the June 20 GDPNow estimate from the Atlanta Fed, residential fixed investment is expected to be a small drag (about 5 basis points) on 2Q GDP after contributing 57 basis points to GDP growth in 1Q. Residential fixed investment is poised to decline by an annualized 1.3% in 2Q after 15.4% growth in 1Q, according to the Nowcast. Yesterday, the Commerce Department reported May Housing Starts of 1.28 million at a seasonally adjusted annual rate, down from 1.58 million year earlier. This morning, we expect the National Association of Realtors to report May Existing Home Sales of 4.10 million (SAAR), down from 4.23 million in May 2023. Next week, we expect the Commerce Department to report May New Home Sales of 640,000 (SAAR), down from 741,000 a year earlier. The S&P/Case-Shiller National Home Price Index jumped 6.5% in March. We expect it to rise about 4.5% for April. The Zillow Home Value index rose by 4.3% in April and 4.3% in May. High mortgage rates are a challenge, but we remain bullish on the sector because demographics point to strong demand amid a decades-long shortage of affordable homes.