Victoria’s Secret Reports Better-Than-Expected Q4 Results

Intimate specialty retailer Victoria’s Secret & Co. (NYSE: VSCO) has reported better-than-expected results for the fourth quarter ended January 29, 2022.

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Following the results, shares of the company rose 1.2% to close at $55 in Wednesday’s extended trading session.

Revenue & Earnings

Victoria’s Secret reported quarterly net sales of $2.18 billion, up 4% year-over-year. Further, the figure surpassed the consensus estimate of $2.14 billion. A 12.2% year-over-year rise witnessed in the net sales of North American stores to $1.3 billion contributed majorly to the overall growth in net sales for the company.

Earnings declined 15.7% year-over-year to $2.70 per share but surpassed the consensus estimate of $2.63 per share.

The company’s total partner-operated stores declined during the quarter to 899 from 933 a year ago.

Outlook

For the first quarter of 2022, the company anticipates revenues of $1.425 billion to $1.495 billion against the consensus estimate of $1.53 billion. It forecasts earnings in the range of $0.70 to $0.95 per share versus the consensus estimate of $1.32 per share.

Management Commentary

The CEO of Victoria’s Secret, Martin Waters, said, “2021 was a milestone year for our Company, our first as a public company. We are keenly aware 2022 will present continued challenges for retailers in this inflationary environment. However, we have a very resilient, dedicated team and strategy prepared to meet these challenges head-on by focusing on the customer journey, being ‘best at bras’, prioritizing people and planet, and launching new initiatives for future growth.”

Stock Rating

The Wall Street community is cautiously optimistic about the stock with a Moderate Buy consensus rating based on 3 Buys and 2 Holds. The average Victoria’s Secret price target of $71.60 implies that the stock has upside potential of 31.8% from current levels. Shares have gained 27.8% over the past year.

Website Traffic

TipRanks’ Website Traffic Tool, which uses data from SEMrush Holdings (SEMR), the world’s biggest website usage monitoring service, offers insight into Victoria’s Secret’s performance this quarter.

According to the tool, year-to-date, Victoria’s Secret’s website traffic recorded a fall of 33.74%, compared to the previous year.

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