Intimatewear and beauty retailer Victoria’s Secret (NYSE:VSCO) will be reporting results tomorrow afternoon. Here’s what to look for.
Victoria's Secret beat analysts’ revenue expectations by 0.6% last quarter, reporting revenues of $1.42 billion, flat year on year. It was a slower quarter for the company, with EPS guidance for next quarter missing analysts’ expectations and a miss of analysts’ EBITDA estimates.
Is Victoria's Secret a buy or sell going into earnings? Read our full analysis here, it’s free.
This quarter, analysts are expecting Victoria's Secret’s revenue to grow 2.3% year on year to $1.29 billion, a reversal from the 4% decrease it recorded in the same quarter last year. Adjusted loss is expected to come in at -$0.62 per share.
Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. Victoria's Secret has missed Wall Street’s revenue estimates five times over the last two years.
Looking at Victoria's Secret’s peers in the apparel retailer segment, some have already reported their Q3 results, giving us a hint as to what we can expect. Urban Outfitters delivered year-on-year revenue growth of 6.3%, beating analysts’ expectations by 1.8%, and Gap reported revenues up 1.6%, topping estimates by 0.6%. Urban Outfitters traded up 18.2% following the results while Gap was also up 12.7%.
Read our full analysis of Urban Outfitters’s results here and Gap’s results here.
There has been positive sentiment among investors in the apparel retailer segment, with share prices up 7.5% on average over the last month. Victoria's Secret is up 29.8% during the same time and is heading into earnings with an average analyst price target of $29.37 (compared to the current share price of $42).
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