Victoria's Secret (VSXY) AI Stock Analysis

Company Guidance

For fiscal year 26, Victoria’s Secret expects net sales to be in the range of $7.1 billion to $7.18 billion, up from the prior range of $7.03 billion to $7.13 billion and representing year over year growth of 8% to 10% compared to prior guidance of 7% to 9%; adjusted operating income is expected in the range of $560 million to $590 million, adjusted net income per diluted share in the range of $4.45 to $4.70, weighted average diluted shares outstanding of approximately 85 million, capital expenditures in the range of $220 million to $240 million or approximately 3% of sales, and international net sales up approximately 20%, while Q3 net sales are forecast in the range of $1.57 billion to $1.6 billion, with top line growth of approximately 7% to 9% and sales up 16% to 18% on a 2 year basis, operating income in the range of $10 million to $20 million, gross margin rate about 38% or approximately 150 basis points of expansion, SG&A rate approximately 37.5% or approximately 100 basis points higher, non operating expense approximately $13 million, income taxes insignificant, and net income per diluted share in the range of a loss of $0.09 to income of $0.01; Q3 AUR is expected up low single digits and units up mid to high single digit, inventory is expected up high single digits, Q3 tariff rates are assumed at approximately 10-12.5% and Q4 at an approximate 20% tariff rate, marketing is in the low 7% of sales with an opportunity over the next couple of years to drive that up to a high single digit and currently just over 7% annually up to high single digits, and store counts at the end of 2026 are expected to be flat to slightly up compared to last year, with 45% of the global fleet in the store of the future design, including 30% in North America and 55% internationally.