Victoria’s Secret rallies 13% to hit 2-year high after robust Q3 earnings forecast, stock up 62% YTD | Stock Market News
Victoria’s Secret & Co. share price rallied to its highest level in over two years on Friday, a sign that the largest US lingerie maker’s turnaround biz is gaining steam among Wall Street traders. Shares of Victoria’s Secret rose as much as 13 per cent, hitting the highest level since May 2022, before paring some of the gains.
The buying interest adds to the stock’s 62 per cent gain this year, more than three times the rise of the Russell 2000 Index over the same period. In its quarterly report released on Thursday, Victoria’s Secret announced that the company’s total revenue will climb as much as two per cent this fiscal year.
Victoria’s Secret shares hit record high: What’s driving the rally?
The outlook was higher than the previous one, calling for a drop of one per cent. The annual adjusted operating income is expected to be as much as $345 million, a 15 per cent bump from what the company said earlier this year. The company also reported that third-quarter sales topped Wall Street expectations and shoppers positively responded early to its holiday merchandise.
According to Bloomberg, this is the company’s first earnings report under Hillary Super, who was named chief executive officer (CEO) in August. The stock has surged since Victoria’s Secret poached her away from Rihanna’s lingerie brand, signalling optimism that the deal will reignite the company’s performance.
According to Wall Street analysts, Victoria’s Secret has struggled for years, dogged by falling sales and increased competition from upstart lingerie brands. It is also looking to move on from allegations of workplace misconduct.
Wall Street Today
US stocks are drifting around their records Friday after data suggested the job market remains solid enough to keep the economy going but not so strong that it raises immediate worries about inflation. The S&P 500 last rose 0.2 per cent, just above its all-time high set on Wednesday. It is rolling toward the close of a third straight winning week in what is likely to be one of its best years since 2000.
The Dow Jones Industrial Average was last down 40 points, or 0.1 per cent, and the Nasdaq composite climbed 0.6 per cent. Stocks held relatively steady as the latest jobs report strengthened traders’ expectations that the US Federal Reserve will cut interest rates again at its next meeting in two weeks.
While the report showed US employers hired more workers than expected last month, the unemployment rate unexpectedly ticked up to 4.2 per cent from 4.1 per cent. Several retailers offered encouragement after delivering better-than-expected results for the latest quarter.
Ulta Beauty rallied 9.2 per cent after topping expectations for profit and revenue. The opening of new stores helped boost revenue, and it raised the bottom end of its forecasted range for sales over this full year.
Lululemon Athletica shares jumped about 17 per cent in early trading on Friday as an upbeat annual forecast raised investor optimism for a robust holiday quarter and prompted Wall Street to take a more bullish view on the stock.
According to news agency Reuters, retailers have been offering mixed signals on how resilient US shoppers can remain amid the slowing job market and still-high prices. Target, for example, gave a dour forecast for the holiday shopping season, while Walmart gave a much more encouraging outlook.
A report on Friday suggested sentiment among US consumers may be improving more than economists expected. The reading from the University of Michigan’s survey hit its highest level in seven months. The survey found a surge in buying for some products as consumers tried to get ahead of possible price increases due to higher tariffs that President-elect Donald Trump has threatened.
With inouts from AP, Bloomberg, and Reuters
