Victoria's Secret (VSCO) is regaining market share, with a turnaround in full swing after its fiscal Q3 beat and a "strong" start to Q4, UBS Securities said in a Monday note.

The company reported a fiscal Q3 adjusted net loss Friday of $0.27 per diluted share, narrowing from the $0.50 loss a year earlier, as revenue increased to $1.47 billion from $1.35 billion.

Fiscal Q3 saw a 6% comparable sales growth in North America and momentum has extended into Q4, with UBS saying this suggests current Q4 trends are ahead of the company's guidance and setting up for a potential beat.

"The company's turnaround playbook is working," UBS said, noting that it expects Victoria's Secret to sustain comparable sales growth and operating margin recapture.

The investment firm also said sales growth, fixed cost leverage, coupled with debt repayment and buybacks, are expected to drive a 15% five-year compound annual growth rate in earnings per share for Victoria's Secret.

UBS raised its price target on Victoria's Secret to $60 from $46, while reiterating its buy rating.

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