L Brands Inc (NYSE:LB) has for many years focused in the retailing of women’s personal care products and lingerie. The company’s brands pass 10 of 11 Good Business Portfolio Guidelines which experts rate as a rather great score. Usually, such scores are used to filter companies to be brought under consideration in the portfolio. Analysts have outlined that the cash flow at L Brands still sticks out as the perfect answer in drawing a clear path ahead. This is after some close consideration of the 6.5 percent yield.
The company owns some two retail names and these are Bath & Body Works and Victoria’s Secret respectively. Both of these showcase some sort of a secular appeal. Victoria’s Secret stands out as a modern go-to destination for all women that believe in getting what they deserve in terms of top end lingerie.
On the other hand, the Bath & Body Works has gone against the tough retail environment and it seems to be making in quite some amazing fashion. Sell offs can at times result in some severe consequences. A recent sell-off by the provider resulted in immense sales loss, G&A de-leveraging, gross margin degradation as well as a major earnings compression.
However, struggles in business are normal and what matters is the clearly-cut path that any provider draws to guide it in the long run. The exit from swim and apparel must have had its dire consequences but of course such struggles are short-term pain as stated by analysts.
Soon, swim and apparel might be phased out and that might of course lead to the comps looking very much like they appeared in early 2016.It goes without saying that quite little has actually changed in terms of the VS lingerie demand. If anyone would go through the trouble of moving about asking, one thing that will come out clearly is the fact that it still remains high.
There are a lot of women who still do their shopping there and it is of course at a great frequency. Victoria’s Secret has its own way of maintaining its dominance in the market and that has helped it uphold a large market share in intimate wear and lingerie. A lot of shoppers seem more inclined to the in-store purchase over the online.