Victoria's Secret (VSCO) AI Stock Analysis

• Market Cap: $3.83B
• Dividend Yield: N/A
• Average Volume (3M): 2.34M
• Price to Earnings (P/E): 28.3
• Beta (1Y): 2.22
• Revenue Growth: 2.97%
• EPS Growth: 9.85%
• Country: US
• Employees: 13,000
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Apparel - Retail
• EPS (TTM): 2.77
• Shares Outstanding: 80,268,920
• 10 Day Avg. Volume: 3,951,271
• 30 Day Avg. Volume: 2,344,981
• PEG Ratio: 0.35
• Price to Book (P/B): 4.49
• Price to Sales (P/S): 0.46
• P/FCF Ratio: 11.63
• Enterprise Value/Market Cap: 2.17
• Enterprise Value/Revenue: 1.30
• Enterprise Value/Gross Profit: 3.55
• Enterprise Value/Ebitda: 14.80
• 1Y Price Target: $65.33
• Price Target Upside: 41.96% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 9
• EPS Forecast (FY): 3.4
• Revenue Forecast (FY): $6.94B

• Rating: 60 Neutral
• Price Target: $49.00 ▲(6.48% Upside)
• Action: Reiterated Date: 03/07/26
• Date: Action: Reiterated 03/07/26

The score is held back primarily by weak technicals (bearish trend and negative MACD) and balance-sheet leverage, despite improving cash flow. Offsetting factors include constructive FY2026 guidance and positive operating momentum, while valuation (P/E ~28) offers limited support without a dividend.

Positive Factors

Strong free cash flow generation

Consistent, high FCF growth provides durable internal funding for capex, store investments and strategic initiatives without heavy reliance on capital markets. Over a 2–6 month horizon this improves flexibility to repay debt, fund ‘Store of the Future’ rollouts and weather near-term headwinds.

Rapid international expansion (China/social commerce)

Double-digit international growth diversifies revenue beyond North America and taps structurally expanding e‑commerce channels (social commerce, live streaming). This geographic and channel diversification supports multi‑quarter top-line resilience and reduces dependence on any single market.

Brand and digital engagement momentum (PINK and core Victoria's Secret)

Resurgent core brands and rising digital engagement signal improved brand equity and customer economics. Higher app adoption and viral product sellouts point to stronger repeat purchase and customer acquisition efficiency, supporting sustainable revenue and margin improvement over coming quarters.

Negative Factors

High balance-sheet leverage

Elevated leverage constrains financial flexibility and heightens vulnerability to shocks (tariffs, inventory swings). Over a multi-month horizon, high debt-to-equity increases refinancing and interest risks and limits the firm’s ability to fund growth or absorb operational setbacks without raising costly capital or cutting investment.

Material tariff exposure

Sustained tariff costs represent an external, structural margin headwind that can persist across quarters. Even with mitigation, tariffs compress gross margins and may force higher prices, reduced promotions, or sourcing shifts—each carrying multi‑quarter implications for demand, margins and supply‑chain complexity.

Inventory build and working capital strain

Elevated inventories tie up cash and raise markdown risk if demand softens, pressuring margins and leverage. With leverage already high, sustained inventory builds can worsen cash conversion and limit the company’s ability to reinvest, making operational execution and inventory management critical over the next several quarters.

Victoria's Secret Business Overview & Revenue Model

Company Description

Victoria's Secret & Co. operates as a specialty retailer of women's intimate, personal care, and beauty products worldwide. The company offers bras, panties, lingerie, sleepwear, loungewear, and athletic attire and swimwear, as well as fragrances and body care products, and accessories under the Victoria's Secret and PINK brands. As of March 2, 2022, it operated approximately 1,400 retail stores. The company was incorporated in 2021 and is headquartered in Reynoldsburg, Ohio.

How the Company Makes Money

Victoria's Secret generates revenue through multiple channels, with its primary income stemming from the sale of lingerie and related apparel. The company operates brick-and-mortar retail stores, an e-commerce platform, and a catalog business. Key revenue streams include direct sales from retail locations and online sales, where customers can purchase items directly from the company's website. Additionally, Victoria's Secret has developed partnerships with various brands and influencers to enhance its marketing reach and drive sales. The company's loyalty program also contributes to its revenue by encouraging repeat purchases. Seasonal promotions and exclusive collections further bolster sales, attracting a diverse customer base.

Victoria's Secret Financial Statement Overview

Summary

Modest revenue recovery and stable gross margin, with strong free cash flow growth supporting flexibility. Offsetting this are thin net margins and elevated leverage (high debt-to-equity), which increases financial risk.

Income Statement

Victoria's Secret shows a modest revenue growth of 1.995% TTM, indicating a recovery from previous declines. The gross profit margin remains stable at around 36.66%, but the net profit margin is relatively low at 2.67%, suggesting limited profitability. EBIT and EBITDA margins are moderate, reflecting operational efficiency challenges.

Balance Sheet

The company has a high debt-to-equity ratio of 4.88 TTM, indicating significant leverage, which could pose financial risk. Return on equity is decent at 26.07%, showing effective use of equity. However, the equity ratio is low, highlighting potential vulnerability in asset financing.

Cash Flow

Free cash flow growth is strong at 27.69% TTM, demonstrating improved cash generation. The operating cash flow to net income ratio is 0.29, indicating moderate cash conversion efficiency. The free cash flow to net income ratio of 0.56 suggests reasonable cash flow support for earnings.

Breakdown	TTM	Jan 2025	Jan 2024	Jan 2023	Jan 2022	Jan 2021
Income Statement
Total Revenue	6.39B	6.23B	6.18B	6.34B	6.79B	5.41B
Gross Profit	2.34B	2.28B	2.24B	2.26B	2.76B	1.57B
EBITDA	561.77M	565.00M	530.00M	751.00M	1.17B	226.00M
Net Income	170.64M	165.00M	109.00M	348.00M	646.00M	-72.00M
Balance Sheet
Total Assets	5.13B	4.53B	4.60B	4.71B	4.34B	4.23B
Cash, Cash Equivalents and Short-Term Investments	249.00M	227.00M	270.00M	427.00M	490.00M	335.00M
Total Debt	4.74B	2.70B	2.70B	2.79B	2.64B	2.07B
Total Liabilities	4.45B	3.87B	4.16B	4.31B	4.09B	3.34B
Stockholders Equity	653.00M	640.00M	417.00M	383.00M	257.00M	891.00M
Cash Flow
Free Cash Flow	309.00M	247.00M	133.00M	273.00M	682.00M	547.00M
Operating Cash Flow	500.00M	425.00M	389.00M	437.00M	851.00M	674.00M
Investing Cash Flow	-183.00M	-153.00M	-254.00M	-555.00M	-169.00M	-123.00M
Financing Cash Flow	-227.00M	-315.00M	-291.00M	58.00M	-527.00M	-465.00M

Victoria's Secret Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 46.02
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For VSCO, the sentiment is Neutral. The current price of 46.02 is below the 20-day moving average (MA) of 54.59, below the 50-day MA of 57.87, and above the 200-day MA of 36.89, indicating a neutral trend. The MACD of -3.80 indicates Positive momentum. The RSI at 38.31 is Neutral, neither overbought nor oversold. The STOCH value of 24.98 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for VSCO.

Victoria's Secret Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
BKE	79 Outperform	$2.51B	11.34	45.18%	6.82%	4.67%	3.46%
ANF	69 Neutral	$3.94B	9.11	38.98%	―	7.57%	1.75%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
VSCO	60 Neutral	$3.83B	28.27	24.58%	―	2.97%	9.85%
GCO	59 Neutral	$273.70M	22.59	-0.13%	―	2.76%	96.01%
AEO	54 Neutral	$2.92B	20.90	12.12%	2.09%	-1.15%	-0.98%

Victoria's Secret Corporate Events

Victoria’s Secret Tops Guidance, Advances Path to Potential

Victoria’s Secret & Co. reported on March 5, 2026, that its fourth quarter and full-year 2025 results, for the period ended January 31, 2026, exceeded prior top- and bottom-line guidance, underlining the early success of its Path to Potential strategy. Comparable sales rose 8% in the fourth quarter and 5% for the year, with net sales reaching $2.27 billion in the quarter and $6.553 billion for 2025, while adjusted operating income climbed to $316 million in Q4 and $403 million for the year, both ahead of expectations.

Despite tariff pressures and last year’s favorable gift-card accounting adjustment, the retailer delivered robust adjusted earnings growth, with adjusted EPS up 22% year over year and underlying sales and profit metrics improving double digits once the prior gift-card benefit is stripped out. Management highlighted stronger customer response, higher average unit retails and broad-based gains across brands and channels as drivers, and signaled confidence with higher 2026 sales and operating income targets, which, if achieved, would reinforce VS&Co’s turnaround and support long‑term shareholder value.

In a portfolio move, the company began a strategic review of DailyLook, a fast-growing but non-core asset acquired via Adore Me in 2022, as it sharpens focus on expanding its flagship Victoria’s Secret and PINK franchises. The review, alongside ongoing efforts to optimize the Adore Me business within the group, suggests potential portfolio reshaping that could reallocate capital toward higher-priority core brands and further refine the company’s positioning in the competitive intimates and apparel market.

The most recent analyst rating on (VSCO) stock is a Buy with a $66.00 price target. To see the full list of analyst forecasts on Victoria’s Secret stock, see the VSCO Stock Forecast page.