L Brands Just Can’t Seem to Win With Earnings

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When L Brands Inc. (NYSE: LB) reported its most recent quarterly results late on Thursday, the company said it had $0.30 in earnings per share (EPS) on $2.62 billion in revenue. Consensus estimates had called for $0.30 in EPS on revenue of $2.58 billion. The fiscal third-quarter financial results from last year had EPS of $0.42 and $2.58 billion in revenue.

During this past quarter, comparable sales decreased 1%.  At the same time, the exit of the swim and apparel categories had a negative impact of about two percentage points to both total company and Victoria’s Secret comparable sales.

In terms of its segments, the firm reported as follows:

  • Victoria’s Secret saw comparable sales drop by 4% for this quarter, down from a decrease in 1% from the third quarter from last year. Total revenues were $1.54 billion for the quarter.
  • Bath & Body Works saw comparable sales increase by 4% this quarter, which dropped about from 7% in the same period from last year. Total revenues were $815.8 million for the quarter.

Looking ahead, the company said that it expects EPS of $1.95 to $2.10 for the fourth quarter, or $3.05 to $3.20 for the full year 2017. The consensus estimates call for $2.03 in EPS for the fourth quarter and $3.14 for the fiscal full year.

Excluding Thursday’s move, L Brands was down about 25% year to date, vastly underperforming the broad markets. Over the past 52 weeks, the stock is down closer to 28%.

Shares of L Brands traded down about 3% early Thursday to $47.68. The consensus analyst price target is $47.04, and the 52-week trading range is $35.00 to $75.50.