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L Brands Sends Its Love, But We're Not Interested

L Brands (LB) reported Q4 sales of $4.069B, well ahead of our $3.853B. The beat continues to be due to Bath & Body Works ((BBW)), as opposed to the Victoria Secret Brand that LB is particularly known for.

Overall sales were +6.3% Y/Y for the year. which was an acceleration vs. 3% last year. However, we expect to hear on the earnings call on Feb 26th that next year will face tougher comparables. Thus we expect a low, conservative guidance, which management already has a history of giving.

Victoria's Secret Accelerated Growth and Remains Sexy

VS store sales were approximately in line with our $1.92B estimate as the company reported stores and comp sales similar to our expectations. Surprising to us, however - VS Direct was +$40M better than our estimate, which will carry higher margins due to lower overhead / OpEx spending. This is a positive,… Read More …