AnalystConsensusTarget updated the narrative for BBWI

Analysts have slightly lowered their price target for Bath & Body Works, trimming the estimate from $41 to $40. Updated forecasts suggest softer revenue growth and profit margin ahead following the latest quarterly results.

Analyst Commentary

Recent updates from Wall Street analysts reflect a blend of confidence and caution regarding Bath & Body Works' outlook. Some are lowering their price targets following the latest quarterly results, while others remain constructive on the company's longer-term prospects.

• Bullish analysts maintain a positive outlook on Bath & Body Works, emphasizing the firm's continued Overweight and Equal Weight ratings. These ratings suggest confidence in future performance despite revised estimates.
• There is acknowledgment that the company is managing through external headwinds, such as tariffs, and is expected to see these impacts peak in the upcoming quarter before normalizing.
• Recent price target revisions, which generally involve modest reductions or increases, indicate analysts see room for upside as the company works through near-term challenges.
• Broader industry sentiment remains supported by Bath & Body Works' strong brand. Analysts point to potential for stabilization and improvement in financial metrics as inventory management and cost controls take hold.

• Bearish analysts highlight expectations for softer revenue growth and compressed profit margins in the coming quarters, contributing to lower price targets.
• Tariff impacts and related cost pressures are seen weighing on results, particularly in the near term. These factors could limit upside as costs are absorbed in inventory flows.
• Analysts express caution around the pace of recovery in sales trends, flagging uncertainty in consumer demand against a backdrop of macroeconomic headwinds.
• Despite the company's relatively resilient positioning, execution risks and evolving industry dynamics lead some analysts to temper their outlook and adjust forecasts lower.

What's in the News

• Bath & Body Works revised its full-year 2025 net sales growth guidance to 1.5% to 2.7%, narrowing the previous range. Earnings per share are now projected between $3.28 and $3.53 for 2025, compared to $3.61 in 2024. Third quarter 2025 sales are expected to rise 1% to 3%, with earnings per share between $0.37 and $0.45 (Key Developments).
• The company completed a significant share buyback, repurchasing 4,142,000 shares (1.95%) for $120.92 million from May through August 2025. This concludes the repurchase of 8,006,891 shares (3.74%) for $238.71 million under the February 2025 authorization (Key Developments).
• Bath & Body Works launched a new Disney Villains Collection, featuring fragrances inspired by Maleficent and the Evil Queen. The collection includes 39 products across categories such as body care, candles, and accessories. It is launching globally in-store and online on September 3, 2025, with early access for loyalty members in late August (Key Developments).
• The brand expanded its presence to over 600 college campus stores nationwide, offering a curated selection of top-selling Gen Z fragrances. This move targets young consumers and follows recognition as the No. 1 fragrance brand among American teens in the April 2025 Piper Sandler survey (Key Developments).

Valuation Changes

• Fair value has decreased modestly, moving from $40.73 to $39.33 per share.
• The discount rate has risen slightly, increasing from 10.45% to 10.66%.
• Revenue growth projections have been trimmed, shifting from 3.11% to 3.00% year-over-year.
• The net profit margin outlook has declined from 10.65% to 10.40%.
• The future P/E ratio has increased moderately, rising from 10.90x to 11.27x.