Victoria’s Secret Faces Strategic Challenges Amidst Pressures on Intimates Segment and E-commerce

In a report released yesterday, Ike Boruchow from Wells Fargo reiterated a Sell rating on Victoria’s Secret (VSCO – Research Report), with a price target of $15.00.

Ike Boruchow has given his Sell rating due to a combination of factors impacting Victoria’s Secret’s performance. Despite some progress, the company’s recent earnings report was not strong enough, with continued pressure on the intimates segment and gross margins. The fiscal year 2025 outlook has been lowered, indicating that more work is needed to stabilize the business in a challenging environment.

The first quarter showed some signs of improvement, but significant challenges remain, particularly in the North American market. Revenue projections for the second half of the year are flat to slightly up, with specific growth in the Beauty segment. However, the impact of tariffs and a recent security incident affecting e-commerce sales have contributed to a cautious outlook. Overall, these factors suggest that Victoria’s Secret needs to address its strategic and operational issues to achieve sustainable growth.

Boruchow covers the Consumer Cyclical sector, focusing on stocks such as Signet Jewelers, Ulta Beauty, and Victoria’s Secret. According to TipRanks, Boruchow has an average return of 4.8% and a 46.57% success rate on recommended stocks.

In another report released today, Bank of America Securities also reiterated a Sell rating on the stock with a $18.00 price target.