Barclays analyst recommends Victoria’s Secret stockpiling in light of recent weakness.
Adrienne Yih upgraded fashion retailer today to “overweight”, citing “meaningful top line acceleration and operating margin growth”.
How high could Victoria’s Secret’s stock rise in 2025? Let’s explore.
How high could Victoria’s Secret’s stock rise in 2025?
According to Barclays analyst Adrienne Yeh, if you invested $1,000 today in Victoria’s Secret, you could end the year with $1,400.
Her price target is essentially a potential of about a 40% increase in VSCO’s current levels.
“Consensus estimations are too low, and will be revised upwards in the next 12-24 months.” Yih said in a client research note that where estimates move, the stock will follow.
She added that the recent Barclays checks indicate an increase in full price sales, which may serve as a catalyst for Victoria’s Secret going forward.
The investment firm believes that positive promotional inflections, positive comparables, and positive sales to inventory spread will all work together in 2025 to drive VSCO share prices up.
Yih has confidence for VSCO’s management
Adrienne Yih is confident in Victoria’s Secret, not only because she has great confidence in Hillary Super, who will be the new chief executive of the company in 2024.
She raised her adjusted EPS estimate for this year and 2026.
Barclay’s bullish report on VSCO comes more than a week after the company reported its financial results, which exceeded Street estimates for the third quarter.
The chief executive Hillary Super said to investors at the time:
“The strong product acceptability supported by our best in mall store experience and dozens digital enhancements are driving a solid conversion rate and basket size.”
At the time this article was written, Victoria’s Secret did not pay dividends.
Jefferies is bullish about Victoria’s Secret, too
Victoria’s Secret forecasted in December a 2%-4% increase in its fiscal Q4 net sales. The adjusted earnings per share are expected to fall between $2 and $2.30.
In a press release, CEO Super revealed that “our merchandise offering and giftable product assortments are resonating well with customers and driving traffic in both stores and online.”
Barclays isn’t the only investment firm to be bullish on VSCO.
Jefferies analysts recommend Victoria’s Secret stock as well, given the recent weakness.
They are calling for a bigger increase to $55, which is a 45% increase from current levels.
The investment firm believes that the fashion retailer will benefit from brand recovery efforts bearing fruit and macro headwinds continuing to subside by 2025.
It believes that the long-term potential is unchanged despite the recent pullback and recommends buying VSCO because it’s “capable to restore lost sales while recapturing the margin.”
This post may be updated as new information becomes available.
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