Victoria's Secret stock shows potential despite valuation concerns
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Apr 10 2023
0mins
Should l Buy VSCO?
Source: SeekingAlpha
Victoria's Secret shares rose 8.01%, reaching a 5-day high, despite the broader market decline with the Nasdaq-100 down 1.14% and S&P 500 down 0.51%.
The stock's performance reflects a 49.9% return over the past year and a 2.2% gain year-to-date, although it experienced an 8.8% decline last week, indicating increased short-term volatility. The DCF model suggests the stock is undervalued by 41.3%, which could attract value-focused investors, despite its current P/E ratio of 25.74x being above industry averages, prompting careful risk assessment.
Investors are encouraged to engage in community discussions to gain insights into the company's future developments, as brand strength and profit expectations remain promising.
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Analyst Views on VSCO
Wall Street analysts forecast VSCO stock price to rise
11 Analyst Rating
4 Buy
7 Hold
0 Sell
Moderate Buy
Current: 45.050
Low
29.00
Averages
53.40
High
73.00
Current: 45.050
Low
29.00
Averages
53.40
High
73.00
About VSCO
Victoria's Secret & Co. is a specialty retailer of women's intimate and other apparel and beauty products marketed under the Victoria's Secret, PINK, and Adore Me brand names. The Company offers a range of products including bras, panties, lingerie, casual sleepwear, apparel, sport and swim, as well as prestige fragrances and body care. Victoria’s Secret brand offers bras, panties, lingerie, casual sleepwear, swim, lounge and sport, as well as fragrances and body care. PINK is a lifestyle brand for young women providing variety of collections and heritage pieces, including apparel, loungewear, activewear, bras, panties, accessories, beauty, and others. Adore Me is a direct-to-consumer lingerie and apparel brand that is focused on serving women of all sizes and budgets.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Victoria's Secret Under Investigation for Securities Fraud
- Financial Performance Decline: Victoria's Secret reported a 4.7% decline in unadjusted net income for Q4 2025, indicating pressure in market competition that could undermine investor confidence moving forward.
- Asset Impairment Loss: The company disclosed a $116.9 million charge in Q4 related to the impairment of certain long-lived tangible and intangible assets from Adore Me, which will directly impact financial health and shareholder value.
- Strategic Review Initiated: Victoria's Secret has initiated a strategic review of its non-core asset DailyLook, indicating a reassessment of its business portfolio aimed at optimizing resource allocation and enhancing profitability.
- Significant Stock Price Drop: Following the earnings report, Victoria's Secret's stock price fell by 22.13%, losing $13.28 per share over two trading sessions, reflecting strong market reaction to the company's financial condition and potentially leading to further declines in investor confidence.
See More
Updated Quant Ratings for Consumer Discretionary Stocks
- Top Rated Companies: Victoria's Secret & Co. (VSCO) achieves a quant rating of 4.81, earning a Strong Buy rating that reflects its robust fundamentals and investor confidence, likely attracting more capital inflow.
- Growth Potential: Aritzia (ATZAF) and LCI Industries (LCII) follow closely with quant ratings of 4.70 and 4.67, indicating ongoing improvements in growth and profitability that could drive their stock prices higher.
- Low Rated Companies: In stark contrast, Duolingo (DUOL) and Lucid Group (LCID) receive quant ratings of 1.04 and 1.06, respectively, categorized as Strong Sell, highlighting their weak fundamentals and potential decline in investor confidence.
- Market Insights: Overall, the updated quant ratings for consumer discretionary stocks provide investors with critical market insights, aiding in the identification of potential investment opportunities and risks to optimize portfolio allocation.
See More
House Committee Seeks Testimony from Epstein's Jail Guard
- Testimony Request: House Oversight Committee Chair James Comer has called for prison guard Tova Noel to testify on March 26, as she allegedly Googled Epstein minutes before his death, potentially providing crucial insights for the investigation.
- Investigation Context: Epstein was arrested in July 2019 on federal child sex trafficking charges and died by suicide weeks later in a New York federal jail; Noel was accused of failing to conduct routine checks and falsifying records, although charges were ultimately dropped.
- Impact of Transparency Act: Since the passage of the Epstein Files Transparency Act, the Department of Justice has released millions of documents related to Epstein, but failed to meet the deadline for full disclosure, leading to criticism over its handling of sensitive information.
- Political Figures Testimony: The committee has subpoenaed high-profile individuals like Bill and Hillary Clinton, all of whom have denied involvement in Epstein's illegal activities, highlighting the case's significant implications for the political landscape.
See More
Victoria's Secret Under Investigation for Securities Fraud
- Declining Financial Performance: Victoria's Secret reported a 4.7% decline in unadjusted net income for Q4 2025, indicating significant pressure in market competition, which may undermine investor confidence and affect future stock performance.
- Asset Impairment Loss: The company disclosed a $116.9 million charge related to the impairment of certain long-lived tangible and intangible assets associated with Adore Me, raising concerns among investors about the quality of the company's assets.
- Strategic Review Initiated: Victoria's Secret has launched a strategic review of its non-core asset DailyLook, signaling a reassessment of its business portfolio aimed at optimizing resource allocation and enhancing overall profitability.
- Stock Price Volatility: Following the financial report, Victoria's Secret's stock price fell by $13.28, or 22.13%, over the next two trading sessions, reflecting heightened market pessimism regarding the company's future outlook.
See More
Victoria's Secret Reports Strong Q4 2025 Earnings with Growth Across Brands
- Significant Sales Growth: In Q4 2025, Victoria's Secret reported net sales of $2.27 billion, an 8% increase year-over-year, with comparable sales rising for the second consecutive quarter, indicating a strong recovery momentum that is expected to enhance market share further.
- Strong International Performance: International sales surged 43% year-over-year to $276 million in Q4, particularly driven by continued strength in the Chinese market, demonstrating the success of the company's global expansion strategy.
- Improved Profit Metrics: Adjusted operating income reached $316 million, with adjusted EPS at $2.77, reflecting a 22% increase from the previous year despite facing $85 million in tariff pressures, showcasing effective management in cost control and profitability.
- Optimistic Future Outlook: Management projects net sales for fiscal 2026 to be between $6.85 billion and $6.95 billion, representing growth of approximately 5% to 6%, and plans to enhance operating margins through digital and global expansion, reflecting strong confidence in sustained growth.
See More
Victoria's Secret Reports Strong Earnings but Stock Declines
- Strong Earnings Report: Victoria's Secret's Q4 revenue rose 8% to $2.27 billion, exceeding market expectations of $2.23 billion, indicating resilience in the retail market despite margin compression leading to an 11.2% stock decline.
- Comparable Sales Growth: The company reported an 8% year-over-year increase in comparable sales, showing improvement from previous quarters and suggesting a rebound in consumer demand with potential for future growth.
- Profitability Improvement: Adjusted earnings per share increased from $2.60 to $2.77, surpassing the consensus estimate of $2.53, reflecting progress in cost control and operational efficiency despite facing asset impairment challenges.
- Optimistic Future Outlook: The company anticipates next quarter's revenue to be between $1.49 billion and $1.525 billion, above the consensus of $1.42 billion, although the full-year growth forecast is more modest, expecting annual revenue of $6.85 billion to $6.95 billion, a 6% increase from last year.
See More
Victoria's Secret Under Investigation for Securities Fraud
- Financial Performance Decline: Victoria's Secret reported a 4.7% decline in unadjusted net income for Q4 2025, indicating pressure in market competition that could undermine investor confidence moving forward.
- Asset Impairment Loss: The company disclosed a $116.9 million charge in Q4 related to the impairment of certain long-lived tangible and intangible assets from Adore Me, which will directly impact financial health and shareholder value.
- Strategic Review Initiated: Victoria's Secret has initiated a strategic review of its non-core asset DailyLook, indicating a reassessment of its business portfolio aimed at optimizing resource allocation and enhancing profitability.
- Significant Stock Price Drop: Following the earnings report, Victoria's Secret's stock price fell by 22.13%, losing $13.28 per share over two trading sessions, reflecting strong market reaction to the company's financial condition and potentially leading to further declines in investor confidence.
See More
Updated Quant Ratings for Consumer Discretionary Stocks
- Top Rated Companies: Victoria's Secret & Co. (VSCO) achieves a quant rating of 4.81, earning a Strong Buy rating that reflects its robust fundamentals and investor confidence, likely attracting more capital inflow.
- Growth Potential: Aritzia (ATZAF) and LCI Industries (LCII) follow closely with quant ratings of 4.70 and 4.67, indicating ongoing improvements in growth and profitability that could drive their stock prices higher.
- Low Rated Companies: In stark contrast, Duolingo (DUOL) and Lucid Group (LCID) receive quant ratings of 1.04 and 1.06, respectively, categorized as Strong Sell, highlighting their weak fundamentals and potential decline in investor confidence.
- Market Insights: Overall, the updated quant ratings for consumer discretionary stocks provide investors with critical market insights, aiding in the identification of potential investment opportunities and risks to optimize portfolio allocation.
See More
House Committee Seeks Testimony from Epstein's Jail Guard
- Testimony Request: House Oversight Committee Chair James Comer has called for prison guard Tova Noel to testify on March 26, as she allegedly Googled Epstein minutes before his death, potentially providing crucial insights for the investigation.
- Investigation Context: Epstein was arrested in July 2019 on federal child sex trafficking charges and died by suicide weeks later in a New York federal jail; Noel was accused of failing to conduct routine checks and falsifying records, although charges were ultimately dropped.
- Impact of Transparency Act: Since the passage of the Epstein Files Transparency Act, the Department of Justice has released millions of documents related to Epstein, but failed to meet the deadline for full disclosure, leading to criticism over its handling of sensitive information.
- Political Figures Testimony: The committee has subpoenaed high-profile individuals like Bill and Hillary Clinton, all of whom have denied involvement in Epstein's illegal activities, highlighting the case's significant implications for the political landscape.
See More
Victoria's Secret Under Investigation for Securities Fraud
- Declining Financial Performance: Victoria's Secret reported a 4.7% decline in unadjusted net income for Q4 2025, indicating significant pressure in market competition, which may undermine investor confidence and affect future stock performance.
- Asset Impairment Loss: The company disclosed a $116.9 million charge related to the impairment of certain long-lived tangible and intangible assets associated with Adore Me, raising concerns among investors about the quality of the company's assets.
- Strategic Review Initiated: Victoria's Secret has launched a strategic review of its non-core asset DailyLook, signaling a reassessment of its business portfolio aimed at optimizing resource allocation and enhancing overall profitability.
- Stock Price Volatility: Following the financial report, Victoria's Secret's stock price fell by $13.28, or 22.13%, over the next two trading sessions, reflecting heightened market pessimism regarding the company's future outlook.
See More
Victoria's Secret Reports Strong Q4 2025 Earnings with Growth Across Brands
- Significant Sales Growth: In Q4 2025, Victoria's Secret reported net sales of $2.27 billion, an 8% increase year-over-year, with comparable sales rising for the second consecutive quarter, indicating a strong recovery momentum that is expected to enhance market share further.
- Strong International Performance: International sales surged 43% year-over-year to $276 million in Q4, particularly driven by continued strength in the Chinese market, demonstrating the success of the company's global expansion strategy.
- Improved Profit Metrics: Adjusted operating income reached $316 million, with adjusted EPS at $2.77, reflecting a 22% increase from the previous year despite facing $85 million in tariff pressures, showcasing effective management in cost control and profitability.
- Optimistic Future Outlook: Management projects net sales for fiscal 2026 to be between $6.85 billion and $6.95 billion, representing growth of approximately 5% to 6%, and plans to enhance operating margins through digital and global expansion, reflecting strong confidence in sustained growth.
See More
Victoria's Secret Reports Strong Earnings but Stock Declines
- Strong Earnings Report: Victoria's Secret's Q4 revenue rose 8% to $2.27 billion, exceeding market expectations of $2.23 billion, indicating resilience in the retail market despite margin compression leading to an 11.2% stock decline.
- Comparable Sales Growth: The company reported an 8% year-over-year increase in comparable sales, showing improvement from previous quarters and suggesting a rebound in consumer demand with potential for future growth.
- Profitability Improvement: Adjusted earnings per share increased from $2.60 to $2.77, surpassing the consensus estimate of $2.53, reflecting progress in cost control and operational efficiency despite facing asset impairment challenges.
- Optimistic Future Outlook: The company anticipates next quarter's revenue to be between $1.49 billion and $1.525 billion, above the consensus of $1.42 billion, although the full-year growth forecast is more modest, expecting annual revenue of $6.85 billion to $6.95 billion, a 6% increase from last year.
See More
