VSCO Should I Buy
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Victoria's Secret & Co. (VSCO) shows mixed signals for a long-term beginner investor. While the company has positive revenue growth and raised full-year guidance, its declining net income and EPS, alongside potential reputational risks tied to Les Wexner's deposition, suggest caution. The technical indicators are moderately bullish, but the lack of strong proprietary trading signals and the potential for a short-term price decline make this stock a hold for now.
The technical indicators suggest a moderately bullish trend. The MACD is positive and expanding, RSI is neutral at 58.713, and moving averages are bullish (SMA_5 > SMA_20 > SMA_200). The stock is trading near its resistance level (R1: 62.295), with key support at 56.68. However, candlestick pattern analysis indicates a 70% chance of a -13.99% decline in the next week.
Seldon Capital's recent acquisition of 155,950 shares reflects confidence in the brand's growth potential.
Q3 revenue increased by 9% YoY, and the company raised its full-year sales guidance to $6.48 billion.
Analysts have raised price targets, with Barclays and Jefferies setting targets at $65, citing robust international growth and margin opportunities.
Net income dropped by 33.93% YoY in Q3, and EPS fell by 35.21%.
Les Wexner's deposition and ties to Jeffrey Epstein could negatively impact public perception and business credibility.
Stock trend analysis predicts a potential short-term decline of -13.99% in the next week.
In Q3 2026, revenue increased by 9.28% YoY to $1.472 billion, and gross margin improved to 36.48% (up 5.01% YoY). However, net income dropped to -$37 million (-33.93% YoY), and EPS declined to -0.46 (-35.21% YoY). While revenue growth is strong, profitability metrics are concerning.
Analyst sentiment is mixed but leaning positive. Barclays and Jefferies have raised price targets to $65, citing inventory discipline, international growth, and margin opportunities. Telsey Advisory upgraded the stock to Outperform with a $66 target. However, Goldman Sachs and Guggenheim maintain Neutral ratings, reflecting demand uncertainty and structural challenges in the retail sector.
