Bath & Body Works, Inc. (BBWI)
NYSE:BBWI
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Bath & Body Works
(NYSE:BBWI)
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Rating:55Neutral
Price Target:
$18.50
▼(-4.69% Downside)
Action:Reiterated
Date:05/28/26
BBWI scores mid-range primarily due to strong cash generation and still-healthy margins, but this is tempered by a high-risk balance sheet (negative equity and sizable debt) and declining sales guidance. Technicals are mixed (near-term stabilization but longer-term downtrend), while valuation support comes mainly from the ~4.1% dividend yield given the unusable P/E data.
Positive Factors
Strong cash generation
Consistent trailing‑12‑month operating cash flow (~$1.16B) and free cash flow (~$0.91B), with FCF roughly 78% of net income, indicate durable cash generation. This funds transformation investments, dividends and debt paydowns, providing financial flexibility across a multi‑quarter turnaround.
Negative Factors
Stretched balance sheet
Negative stockholders' equity (~-$1.1B) alongside about $4.7B of debt indicates a highly leveraged capital structure. Negative equity distorts leverage metrics, increases refinancing and covenant risk, and limits the company's cushion and strategic flexibility during prolonged demand weakness.
Read all positive and negative factors
Positive Factors
Negative Factors
Strong cash generation
Consistent trailing‑12‑month operating cash flow (~$1.16B) and free cash flow (~$0.91B), with FCF roughly 78% of net income, indicate durable cash generation. This funds transformation investments, dividends and debt paydowns, providing financial flexibility across a multi‑quarter turnaround.
Read all positive factors
Bath & Body Works Key Performance Indicators (KPIs)
Any
Revenue By Segment
Breaks down revenue by product lines or business units, revealing which segments are driving sales and where there might be opportunities or challenges.
Breaks down revenue by product lines or business units, revealing which segments are driving sales and where there might be opportunities or challenges.
Data provided by:
The Fly
The FlyBath & Body Works (BBWI) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$3.62B
Dividend Yield4.16%
Average Volume (3M)6.24M
Price to Earnings (P/E)4.8
Beta (1Y)1.46
Revenue Growth-1.40%
EPS Growth-4.34%
CountryUS
Employees8,975
SectorConsumer Cyclical
Sector Strength84
IndustrySpecialty Retail
Share Statistics
EPS (TTM)3.47
Shares Outstanding201,561,810
10 Day Avg. Volume7,447,417
30 Day Avg. Volume6,243,427
Financial Highlights & Ratios
PEG Ratio-0.47
Price to Book (P/B)-3.61
Price to Sales (P/S)0.63
P/FCF Ratio5.33
Enterprise Value/Market Cap2.19
Enterprise Value/Revenue1.09
Enterprise Value/Gross Profit2.53
Enterprise Value/Ebitda5.58
Forecast
1Y Price Target
$23.38Price Target Upside20.43% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering8
EPS Forecast (FY)2.64
Revenue Forecast (FY)$7.09B
Bath & Body Works Business Overview & Revenue Model
Company Description
Bath & Body Works, Inc. operates a specialty retailer of home fragrance, body care, and soaps and sanitizer products. The company sells its products under the Bath & Body Works, White Barn, and other brand names through specialty retail stores and...
How the Company Makes Money
BBWI makes money primarily by designing, sourcing, marketing, and selling branded personal care and home fragrance products directly to consumers. Its key revenue streams are (1) retail store sales, generated through company-operated Bath & Body W...
Bath & Body Works Earnings Call Summary
Earnings Call Date:May 27, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Aug 19, 2026
Earnings Call Sentiment Neutral
Balanced call: management reported an EPS beat and early product and channel proof points (double-digit productivity on new formulas, Amazon traction, White Barn growth) and reaffirmed full-year guidance, while the top line and core category (body care) remain pressured with margin headwinds from tariffs, inflation and crude oil. The company is executing a multiyear transformation (consumer-first formula) with planned investments, inventory discipline and cost-savings, but meaningful financial inflection is expected later in the transformation rather than immediately.Positive Updates
Net Sales and EPS Beat Expectations in Q1
Q1 net sales of $1.4 billion, down 3.2% YoY, were reported as ahead of the company’s guidance range; adjusted EPS was $0.32, slightly ahead of expectations.
Negative Updates
Top-Line Pressure and Category Weakness
Underlying business trends remain pressured; Q1 net sales declined 3.2% YoY and management stated trends are consistent with prior quarters, underscoring the multiyear nature of the turnaround.
Read all updates
Q1-2026 Updates
Positive
Negative
Net Sales and EPS Beat Expectations in Q1
Q1 net sales of $1.4 billion, down 3.2% YoY, were reported as ahead of the company’s guidance range; adjusted EPS was $0.32, slightly ahead of expectations.
Read all positive updates
Company Guidance
Bath & Body Works reaffirmed full‑year 2026 guidance with net sales expected to be down 4.5% to 2.5% and adjusted EPS of $2.40–$2.65, reiterating a full‑year gross margin target of ~42.4% and assuming tariffs/inflation roughly neutral year‑over‑year (tariffs were ~ $80M in FY25); the guidance excludes share repurchases, assumes elevated energy prices and does not assume any tariff refunds. For Q2 the company expects net sales down 5%–3%, gross profit rate ≈40%, SG&A rate ≈31.8%, net non‑operating expense ≈$56M, a tax rate ≈29.3%, weighted average diluted shares ≈203M and EPS of $0.20–$0.25. Additional 2026 metrics cited include ~ $270M of capital expenditures, ~ $600M of free cash flow (including a $66M after‑tax interchange settlement benefit recognized in Q1), Q1 inventory down 10% year‑over‑year, and ongoing increased transformation investments (with greater product and marketing spend expected in Q3).Bath & Body Works Financial Statement Overview
Summary
Income Statement
58
Neutral
Balance Sheet
24
Negative
Cash Flow
72
Positive
| Breakdown | TTM | Jan 2026 | Jan 2025 | Jan 2024 | Jan 2023 | Jan 2022 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 7.25B | 7.29B | 7.31B | 7.43B | 7.56B | 7.88B |
| Gross Profit | 3.13B | 3.19B | 3.23B | 3.24B | 3.25B | 3.85B |
| EBITDA | 1.42B | 1.41B | 1.62B | 1.64B | 1.61B | 2.17B |
| Net Income | 727.00M | 649.00M | 798.00M | 878.00M | 800.00M | 1.33B |
Balance Sheet | ||||||
| Total Assets | 4.96B | 5.07B | 4.87B | 5.46B | 5.49B | 6.03B |
| Cash, Cash Equivalents and Short-Term Investments | 820.00M | 953.00M | 674.00M | 1.08B | 1.23B | 1.98B |
| Total Debt | 4.71B | 4.95B | 4.96B | 5.57B | 6.05B | 6.01B |
| Total Liabilities | 6.09B | 6.35B | 6.25B | 7.09B | 7.70B | 7.54B |
| Stockholders Equity | -1.13B | -1.28B | -1.39B | -1.63B | -2.21B | -1.52B |
Cash Flow | ||||||
| Free Cash Flow | 909.00M | 865.00M | 660.00M | 656.00M | 816.00M | 1.22B |
| Operating Cash Flow | 1.16B | 1.10B | 886.00M | 954.00M | 1.14B | 1.49B |
| Investing Cash Flow | -230.00M | -227.00M | -162.00M | -286.00M | -328.00M | -259.00M |
| Financing Cash Flow | -746.00M | -599.00M | -1.13B | -815.00M | -1.56B | -3.19B |
Bath & Body Works Technical Analysis
Negative
19.41
Price Trends
18.40
Negative
19.96
Negative
21.56
Negative
Market Momentum
-0.14
Negative
44.08
Neutral
15.71
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BBWI, the sentiment is Negative. The current price of 19.41 is above the 20-day moving average (MA) of 18.02, above the 50-day MA of 18.40, and below the 200-day MA of 21.56, indicating a bearish trend. The MACD of -0.14 indicates Negative momentum. The RSI at 44.08 is Neutral, neither overbought nor oversold. The STOCH value of 15.71 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for BBWI.
Bath & Body Works Risk Analysis
Bath & Body Works disclosed 41 risk factors in its most recent earnings report. Bath & Body Works reported the most risks in the "Production" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Bath & Body Works Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
81 Outperform | $6.65B | 5.87 | 18.50% | 2.46% | 0.97% | 10.77% | |
66 Neutral | $6.36B | 22.60 | -25.47% | ― | 1.78% | 75.71% | |
66 Neutral | $4.10B | 13.13 | 18.85% | 3.10% | 30.50% | -13.32% | |
64 Neutral | $19.88B | 17.20 | 44.07% | ― | 11.30% | 4.23% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
61 Neutral | $14.96B | 13.17 | 38.34% | 5.46% | 0.99% | 31.91% | |
55 Neutral | $3.62B | 4.84 | -52.40% | 4.16% | -1.40% | -4.34% |
* Consumer Cyclical Sector Average
BBWI
Bath & Body Works
17.43
-8.18
-31.94%
BBY
Best Buy Co
71.54
2.42
3.50%
ULTA
Ulta Beauty
467.07
1.43
0.31%
VIPS
Vipshop
13.53
-0.54
-3.80%
ETSY
Etsy
66.86
3.05
4.78%
MNSO
MINISO Group Holding
12.95
-4.44
-25.51%
Bath & Body Works Corporate Events
Business Operations and StrategyExecutive/Board ChangesFinancial Disclosures
Bath & Body Works Posts Q1 Results, Reaffirms 2026 Outlook
Negative
May 27, 2026
On May 27, 2026, Bath Body Works reported first‑quarter 2026 net sales of $1.38 billion, down 3% year on year, with earnings per diluted share of $0.90 and adjusted EPS of $0.32, exceeding guidance but still below management’s perform...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.