Analyst Paul Lejuez from Citi maintained a Buy rating on Bath & Body Works and keeping the price target at $40.00.
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Paul Lejuez has given his Buy rating due to a combination of factors that suggest a positive outlook for Bath & Body Works. Despite a slight miss in the second quarter earnings per share, largely due to higher selling, general, and administrative expenses, the company’s sales exceeded expectations. Management has expressed strong confidence in their product pipeline and marketing strategy, which are expected to drive long-term growth.
Additionally, while there are concerns about weaker gross margins in the third quarter due to one-time tariff impacts, these are anticipated to abate by the fourth quarter. The company is also expected to benefit from new product innovations and revenue streams, which should contribute to low single-digit topline growth in fiscal 2026. With shares trading at a relatively low multiple of future earnings, the risk/reward profile appears favorable, supporting the Buy recommendation.
Lejuez covers the Consumer Cyclical sector, focusing on stocks such as PVH, Gap Inc, and Urban Outfitters. According to TipRanks, Lejuez has an average return of 10.0% and a 57.91% success rate on recommended stocks.
In another report released yesterday, TD Cowen also maintained a Buy rating on the stock with a $38.00 price target.