Wall Street loves Victoria's Secret post divorce

Monami

09/08/2021 18:18

** Victoria's Secret  VSCO.N  attracts yet another bull a
week after the lingerie brand completed its separation from Bath
& Body Works  BBWI.N , formerly L Brands
    ** JP Morgan starts coverage of VSCO at "overweight" with
Dec 2022 PT of $100, implying ~73% upside to stock's Fri close
    ** VSCO shares seen as "compelling" entry point (trading
sub-3x its FY23 EBITDA estimate vs 6.0x for specialty retail
avg) given co's status as the leading market share player in US
lingerie (~20% share) and women’s mass fragrance (~30% share)
categories, JPM says in note
    ** JPM becomes the 7th brokerage to initiate VSCO with "buy"
equivalent rating, and tying Wells Fargo for Street-high PT, per
Refinitiv data
    ** Wells Fargo on Aug 4 named VSCO a 'top pick', saying
though the brand has struggled since 2015, it believes
management's new approach can lead to recovery in profitability
over the long term
    ** Median PT on VSCO is $88 - Refinitiv data
    ** VSCO shares on Mon last up 17.2% at $67.58. Shares on Aug
3 opened at $48 on debut  urn:newsml:reuters.com:*:nL1N2PA1NF
    ** Shares of BBWI last up 0.3% at $61.83 on Mon. Stock has
dipped ~4% over the past week, but has doubled this year

    

 (Lance Tupper is a Reuters market analyst. The views expressed
are his own)
 ((lance.tupper.tr.com@reuters.net
lance.tupper@tr.com 1-332-219-1430))