Overview

• Victoria's Secret Q3 net sales rise 9% yr/yr

• Adjusted loss per share comes in at $0.27, less than analysts' expectations

• Company raises full-year 2025 net sales and earnings guidance

Outlook

• Victoria's Secret raises full-year 2025 net sales forecast to $6.450 bln-$6.480 bln

• Company expects full-year 2025 adjusted EPS of $2.40-$2.65

• Fourth-quarter net sales forecasted at $2.170 bln-$2.200 bln

Result Drivers

• PATH TO POTENTIAL STRATEGY - Co attributes Q3 net sales growth to execution of its Path to Potential strategy

• GROSS MARGIN EXPANSION - Co reports 170 basis point expansion in adjusted gross margin due to reduced promotions and higher regular-priced selling

• GLOBAL EXPANSION - Co cites accelerating global growth as a key driver of Q3 performance

Victoria's Secret shares jumped 9.6% in premarket trading.

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "hold" and the breakdown of recommendations is 3 "strong buy" or "buy", 4 "hold" and 2 "sell" or "strong sell"

• The average consensus recommendation for the apparel & accessories retailers peer group is "buy."

• Wall Street's median 12-month price target for Victoria's Secret & Co is $35.00, about 15.8% below its December 4 closing price of $41.57

• The stock recently traded at 19 times the next 12-month earnings vs. a P/E of 11 three months ago