Victoria's Secret 4Q Sales Seen Rising Slightly, Eyes on Outlook -- Earnings Preview

Victoria's Secret (VSCO) is set to report its fourth-quarter earnings on March 5, 2025, and investors are eagerly awaiting the results. The lingerie retailer is expected to post a year-over-year decline in earnings on higher revenues, but the actual results could significantly impact the stock's price movement. In this earnings preview, we'll take a closer look at the company's recent performance, analyst estimates, and key factors to watch.

Recent Performance and Analyst Estimates

Victoria's Secret has been facing headwinds in the lingerie category, with comparable sales declining 6% in the most recent quarter. However, the company has been able to maintain its market share and grow internationally, with sales increasing 24% year-over-year in the fourth quarter. Analysts expect the company to report earnings of $2.31 per share on revenues of $2.1 billion, representing a year-over-year change of -10.5% and +1% respectively.

Key Factors to Watch

1. Earnings Beat or Miss: A positive earnings surprise could drive the stock higher, while a miss could lead to a decline. The Earnings ESP (Expected Surprise Prediction) for Victoria's Secret is +0.11%, indicating a potential earnings beat.
2. Revenue Growth: Investors will be looking for signs of revenue growth, particularly in the North American market. Strong international exposure and growth strategies could also contribute to overall sales performance.
3. Guidance: Management's outlook for the upcoming quarter and full year will provide valuable insights into the company's future prospects. Investors will be watching for any changes in guidance, as well as any commentary on the broader intimates market and the company's competitive position.
4. Inventory Management: Effective inventory management is crucial for maintaining profitability and avoiding markdowns. Investors will be interested in any updates on inventory levels and the company's ability to manage its supply chain.



Outlook and Conclusion

Victoria's Secret's fourth-quarter earnings report will provide important insights into the company's performance and future prospects. With a potential earnings beat and strong revenue growth, the company could see its stock price move higher. However, investors should also pay close attention to management's guidance and any commentary on the broader intimates market and the company's competitive position. By focusing on these key factors, investors can make more informed decisions about Victoria's Secret's future prospects.

In conclusion, Victoria's Secret's fourth-quarter earnings report is an important event for investors, as it could significantly impact the stock's price movement. By staying informed about the company's recent performance, analyst estimates, and key factors to watch, investors can better prepare for the earnings release and make more strategic investment decisions.