Published on 1 Feb 2023 on Benzinga via Yahoo Finance
Victoria's Secret Analyst Sticks To 'Market Perform' Rating Citing Competitive Marketplace
Telsey Advisory Group analyst reiterated a Market Perform rating on the shares of Victoria's Secret & Co (NYSE: VSCO) with a price target of $45.00.VSCO updated its fourth-quarter earnings guidance, raising its outlook, while announcing a $125 million accelerated share repurchase program (ASR.On the topline, VSCO now looks for sales to decline 7%-8%, a slight improvement from the down high-single digit outlook provided previously, the analyst noted.The analyst added that margins are expected to align with the company's prior expectations, reflecting a very promotional holiday period with stronger SG&A control.VSCO is controlling what it can in this challenging macro environment and, when adjusted for modal shifts (higher in-transit) expects to end FY22 with inventory levels down low double digits Y/Y, said the analyst.The company noted that the economic environment heading into FY23 is "not ideal" and may result in a year similar to FY22.Despite the challenging macro operating environment, VSCO has identified and executed against numerous long-term drivers of growth, said the analyst.In addition to VSCO's clear market leadership position within intimates, these longer-term growth initiatives, combined with its financial stability and cash flow potential, are key competitive advantages for the company, the analyst specified.Price Action: VSCO shares are trading higher by 7.22% at $45.19 on the last check Wednesday.
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