Williams Sonoma's majestic few years of winning may be about to come to an abrupt halt.

On Monday, Jefferies analyst Jonathan Matuszewski slashed his rating on the home goods retailer's stock to Underperform from Hold and cut his price target to $100 from $160.

Shares fell more than 2% during Monday's session.

The stock has gained more than 100% in the past five years as sales and profits were turbo-charged by low rates spurring a wave of first-time home buyers. But with the Federal Reserve aggressively hiking interest rates and the housing market cooling, Williams Sonoma could be in for a world of hurt in 2023.

"As a discretionary retailer serving upper-middle income consumers whose EBIT% is 2x vs. 2019 thanks in part to over-earning, we see Williams Sonoma shares underperforming ahead of a softer macro," Matuszewski wrote.

Here are the five biggest factors behind Matuszewski's call.

The furniture industry is slowing down.

"Demand destruction of discretionary durables: Starting now, worse in 2023. Furniture spend growth for ~$140K households stalled in 2001 and declined ~34% in '08/'09. Williams Sonoma comps were hit, gross margin % fell, and SG&A deleveraged. EBIT% went from +HSD% pre-recession to +LSD-MSD% with firmly negative EPS in trough years, implying this call has duration beyond 2023E into 2024E. 1H comps were solid, but industry unit velocity is worsening. Backlog will minimize 3Q sales underperformance, but real-time deteriorating web traffic (particularly Oct.) suggests 4Q will more visibly underwhelm."

Many retailers have made too much money during the COVID-19 pandemic.

"Retailers have over-earned, and WSM is a poster child. EBIT% expanded >900 bps cumulatively from 2019-2022E, well above retail peers. With our expectations for calendar 2023E comps flattish, occupancy tailwinds will disappear. More important, investors underestimate selling margin reversion in calendar 2323E driven by inventory availability and a more price-sensitive consumer. We see elevated West Elm promos on rugs, lighting, and outdoor furniture, supporting our GM% well-below the Street."