BBWI Stock Forecast & Price Target

Bath & Body Works has recently narrowed its annual guidance, projecting a sales increase between 1.5% and 2.7% year-over-year, indicating a stable outlook despite recent fluctuations. The retailer has seen a positive shift in international sales, which grew by 6.1% year-over-year to $73 million, contrasting with previous declines, and management is optimistic about enhancing digital sales penetration beyond 20%. Additionally, the company's strategic focus on expanding its real estate portfolio towards off-mall locations, which now constitute 59% of its stores, combined with efforts to strengthen infrastructure and streamline operations, positions Bath & Body Works for sustained growth and profitability in the long term.

Bath & Body Works has revised its financial guidance for fiscal year 2025 to reflect a low-single-digit decline in net sales and an adjusted EPS of at least $2.87, significantly lower than previous expectations. The company also projected a substantial decline in fourth-quarter sales, anticipating a high-single-digit decrease year-over-year, which is a stark contrast to earlier consensus estimates expecting modest growth. Additionally, the overall performance has been impacted by weaker sales, increased gross margin pressure, and challenges in consumer purchasing sentiment, leading to significant reductions in previously optimistic sales forecasts.