For many, the 2022 holiday season was a subdued event. However, it proved anything but for Victoria’s Secret (NYSE:VSCO), who came out of the holiday season flush with cash and very big news. The stock is up in a big way in Wednesday afternoon trading.
Essentially, despite the fact that the typical shopper was pinching pennies, the same could not be said for Victoria’s Secret shoppers. Word from Martin Waters, Victoria’s Secret CEO, revealed that store sales performance was “…at the better end of our guidance…” Further, Waters revealed that margins were “…solidly in line with our expectations…” despite what proved to be “…a very promotional environment during the holiday season.” In fact, the holiday was actually enough to prompt a hike in fourth-quarter guidance.
Thanks to that killer holiday, Victoria’s Secret now looks for earnings per share figures to come in between $2.25 and $2.35. That’s up substantially from the earlier range of $2.05 to $2.25. It also handily surpasses analysts’ consensus figure of $2.23 per share. The latest guidance also includes such factors as Victoria’s Secret’s acquisition of the direct-to-consumer AdoreMe brand. Also, giving the stock a shot in the arm is a plan to buy back stock with $125 million to back up those plans.
While investors are happy about the recent successes, a wait-and-see attitude still prevails. Analyst consensus currently calls Victoria’s Secret stock a Hold. With an average price target of $44.88 per share, the stock has 0.22% downside risk.