Bath & Body Works (BBWI)
NYSE:BBWI
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Bath & Body Works
(NYSE:BBWI)
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Rating:56Neutral
Price Target:
$18.50
▲(2.15% Upside)
Action:ReiteratedDate:03/06/26
BBWI scores in the mid-range primarily due to elevated balance-sheet risk (high debt and negative equity) and guidance for further sales/EPS declines in 2026. Offsetting factors include continued strong cash generation, an above-market dividend yield, and a neutral technical setup with modest near-term momentum but a still-weak longer-term trend.
Positive Factors
Free Cash Flow Generation
Consistent multi-hundred-million-dollar free cash flow provides durable internal funding for dividends, capex, and debt reduction. Even with variability and a forecasted decline, this level of cash generation supports execution of turnaround investments and reduces sole reliance on external financing over the next 2–6 months.
Negative Factors
High Leverage & Negative Equity
Very high debt and persistently negative equity materially constrain financial flexibility, increasing refinancing and interest-rate sensitivity. This capital-structure profile limits the firm's ability to absorb prolonged sales weakness and reduces optionality for sustained buybacks or aggressive reinvestment.
Read all positive and negative factors
Positive Factors
Negative Factors
Free Cash Flow Generation
Consistent multi-hundred-million-dollar free cash flow provides durable internal funding for dividends, capex, and debt reduction. Even with variability and a forecasted decline, this level of cash generation supports execution of turnaround investments and reduces sole reliance on external financing over the next 2–6 months.
Read all positive factors
Bath & Body Works (BBWI) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$3.64B
Dividend Yield4.16%
Average Volume (3M)6.05M
Price to Earnings (P/E)7.1
Beta (1Y)1.41
Revenue Growth-1.04%
EPS Growth-20.88%
CountryUS
Employees8,975
SectorConsumer Cyclical
Sector Strength84
IndustrySpecialty Retail
Share Statistics
EPS (TTM)2.05
Shares Outstanding201,134,260
10 Day Avg. Volume6,503,278
30 Day Avg. Volume6,045,805
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 Cap2.12
Enterprise Value/Revenue1.06
Enterprise Value/Gross Profit2.42
Enterprise Value/Ebitda5.49
Forecast
1Y Price Target
$25.30Price Target Upside39.70% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering10
EPS Forecast (FY)2.63
Revenue Forecast (FY)$7.08B
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 retailing Bath & Body Works-branded consumable personal care and home fragrance products at a margin above product costs and operating expenses. Its key revenue streams are (1) dire...
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 Earnings Call Summary
Earnings Call Date:Mar 04, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 14, 2026
Earnings Call Sentiment Neutral
The call communicated a clearly articulated multi-year turnaround plan (Consumer First Formula) with concrete early execution wins — product innovation proof points, strategic marketplace expansion (Amazon), international momentum, clean inventory, strong FY2025 free cash flow, and a defined $250M cost-savings program. However, near-term financials remain pressured: comparable and category-specific sales declines, margin compression driven by tariffs and planned product investments, and guidance calling for further revenue declines in 2026 (and a lower free cash flow target). Management emphasized confidence in the strategy and patience for benefits to accrue over 2026 into 2027, but near-term operating and macro headwinds temper the immediate outlook.Positive Updates
Quarterly Revenue and EPS Beat vs Expectations
Q4 net sales of $2.7 billion, down 2.3% year-over-year but better than the guidance floor; adjusted EPS of $2.05, down ~2% year-over-year but ahead of expectations.
Negative Updates
Top-Line Pressure and Guidance for Continued Declines
Company expects 2026 net sales to be down 4.5% to down 2.5%; Q1 2026 guidance calls for net sales down 6% to down 4%, indicating near-term top-line pressure despite operational actions.
Read all updates
Q4-2025 Updates
Positive
Negative
Quarterly Revenue and EPS Beat vs Expectations
Q4 net sales of $2.7 billion, down 2.3% year-over-year but better than the guidance floor; adjusted EPS of $2.05, down ~2% year-over-year but ahead of expectations.
Read all positive updates
Company Guidance
For fiscal 2026 Bath & Body Works expects net sales down 4.5% to down 2.5%, full-year adjusted EPS of $2.40–$2.65, a full-year gross profit rate of ~42.4% (with roughly 130 bps of margin pressure embedded and tariffs roughly neutral to earnings y/y), an adjusted SG&A rate of ~29.2%, adjusted net non‑operating expense of ~$230M, an adjusted tax rate of ~26.5%, weighted average diluted shares of ~203M, and no share repurchases assumed; Q1 guidance calls for net sales down 6% to down 4%, Q1 gross profit rate ~42.5% (including ~150 bps tariff headwind), Q1 adjusted SG&A rate ~32.3%, Q1 adjusted net non‑operating expense ~$60M, Q1 adjusted tax rate ~28.5%, ~202M weighted shares, and Q1 adjusted EPS of $0.24–$0.30. Management plans ~$175M of the $250M two‑year Fuel for Growth savings in 2026, ~$270M of CapEx, ~$600M of free cash flow (including a $65M after‑tax settlement benefit), will maintain a $0.80 annual dividend, redeem $284M of January 2027 notes in Q1, targets ~1% square footage growth, expects international net sales up mid‑ to high‑single digits, and has factored roughly $50M (≈0.5 point) of benefit from expanded distribution (e.g., Amazon) into the plan.Bath & Body Works Financial Statement Overview
Summary
Income Statement
63
Positive
Balance Sheet
28
Negative
Cash Flow
58
Neutral
| Breakdown | Jan 2026 | Jan 2025 | Jan 2024 | Jan 2023 | Jan 2022 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 7.29B | 7.31B | 7.43B | 7.56B | 7.88B |
| Gross Profit | 3.19B | 3.23B | 3.24B | 3.25B | 3.85B |
| EBITDA | 1.38B | 1.62B | 1.64B | 1.61B | 2.17B |
| Net Income | 649.00M | 798.00M | 878.00M | 800.00M | 1.33B |
Balance Sheet | |||||
| Total Assets | 5.07B | 4.87B | 5.46B | 5.49B | 6.03B |
| Cash, Cash Equivalents and Short-Term Investments | 953.00M | 674.00M | 1.08B | 1.23B | 1.98B |
| Total Debt | 4.95B | 4.96B | 5.57B | 6.05B | 6.01B |
| Total Liabilities | 6.35B | 6.25B | 7.09B | 7.70B | 7.54B |
| Stockholders Equity | -1.28B | -1.39B | -1.63B | -2.21B | -1.52B |
Cash Flow | |||||
| Free Cash Flow | 865.00M | 660.00M | 656.00M | 816.00M | 1.22B |
| Operating Cash Flow | 1.10B | 886.00M | 954.00M | 1.14B | 1.49B |
| Investing Cash Flow | -227.00M | -162.00M | -286.00M | -328.00M | -259.00M |
| Financing Cash Flow | -599.00M | -1.13B | -815.00M | -1.56B | -3.19B |
Bath & Body Works Technical Analysis
Negative
18.11
Price Trends
21.17
Negative
20.63
Negative
24.17
Negative
Market Momentum
-0.88
Negative
40.89
Neutral
61.32
Neutral
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 18.11 is below the 20-day moving average (MA) of 19.18, below the 50-day MA of 21.17, and below the 200-day MA of 24.17, indicating a bearish trend. The MACD of -0.88 indicates Negative momentum. The RSI at 40.89 is Neutral, neither overbought nor oversold. The STOCH value of 61.32 is Neutral, 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 | $7.41B | 8.74 | 17.98% | 2.46% | -2.97% | -8.57% | |
69 Neutral | $5.07B | 28.32 | 25.85% | 3.10% | 13.37% | -19.37% | |
63 Neutral | $23.73B | 20.35 | 44.07% | ― | 5.45% | 4.28% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
56 Neutral | $3.64B | 7.11 | -44.22% | 4.16% | -1.04% | -20.88% | |
55 Neutral | $5.24B | 33.41 | -15.36% | ― | 1.98% | -20.98% | |
51 Neutral | $13.43B | 12.85 | 38.54% | 5.46% | -0.95% | -48.28% |
* Consumer Cyclical Sector Average
BBWI
Bath & Body Works
18.11
-6.51
-26.45%
BBY
Best Buy Co
64.20
11.03
20.74%
ULTA
Ulta Beauty
542.65
214.64
65.44%
VIPS
Vipshop
15.02
2.76
22.51%
ETSY
Etsy
54.40
13.60
33.33%
MNSO
MINISO Group Holding
16.22
2.07
14.67%
Bath & Body Works Corporate Events
Business Operations and StrategyStock BuybackFinancial Disclosures
Bath & Body Works Reports Q4 Results, Guides 2026 Lower
Negative
Mar 4, 2026
Bath Body Works reported on March 4, 2026 that fourth-quarter 2025 net sales fell 2% to $2.7 billion, with earnings per diluted share declining to $1.99, or $2.05 on an adjusted basis, as it absorbed $15 million in transformation-related costs. F...
Business Operations and StrategyPrivate Placements and Financing
Bath & Body Works Announces Redemption of 2027 Senior Notes
Positive
Mar 4, 2026
On March 3, 2026, Bath Body Works, Inc. announced it had issued a notice of redemption for all outstanding 6.694% Senior Notes due 2027, with a redemption date set for April 10, 2026. The redemption price will be determined under the governing in...
Executive/Board Changes
Bath & Body Works announces chief legal officer transition
Neutral
Feb 25, 2026
On February 24, 2026, Bath Body Works, Inc. announced that Michael Wu ceased serving as its Chief Legal Officer and Corporate Secretary, and the company has begun a search for his successor. Wu is expected to remain as a non-executive employee th...
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.