Victoria's Secret (VSCO) Is Up 10.1% After Goldman Sachs Upgrade on Brand Turnaround Momentum – What's Changed

• Victoria’s Secret was recently upgraded by Goldman Sachs from Sell to Neutral, following second-quarter earnings that surpassed analyst expectations and showed improved brand engagement under new leadership.
• This shift reflects growing confidence in the company’s ongoing transformation efforts and indicates that its recent strategies are beginning to resonate with both analysts and consumers.
• We'll look at how Goldman Sachs' analyst upgrade, driven by improved brand momentum, may influence Victoria's Secret's investment outlook.

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Victoria's Secret Investment Narrative Recap

To own Victoria’s Secret stock, investors must have confidence in the company’s ongoing brand transformation and its ability to re-engage consumers and drive sales growth despite operating in a challenging retail environment. While Goldman Sachs’ recent upgrade underscores improved brand momentum as a potential short-term catalyst, the most significant near-term risk remains heightened tariff costs, which are still projected to weigh on margins and profits in fiscal 2025; the upgrade does not materially reduce this risk.

Among recent developments, Victoria’s Secret raised its full-year 2025 earnings guidance, projecting net sales between US$6.33 billion and US$6.41 billion, reflecting management’s optimism for sustained sales growth. For investors, this new guidance is especially relevant given the importance of continued topline momentum as a key catalyst, particularly as the brand works to offset external pressures and stabilize margin trends.

However, investors should be mindful that despite recent brand engagement gains, tariff exposure may continue to pressure profit margins...

Read the full narrative on Victoria's Secret (it's free!)

Victoria's Secret's outlook anticipates $6.7 billion in revenue and $143.6 million in earnings by 2028. This assumes a 2.2% annual revenue growth rate and a $7.8 million decrease in earnings from the current level of $151.4 million.

Uncover how Victoria's Secret's forecasts yield a $25.40 fair value, a 26% downside to its current price.

Exploring Other Perspectives

Six Simply Wall St Community fair value estimates for Victoria’s Secret range from US$20.79 to US$43.97 per share. With tariff-related margin pressures central to many outlooks, explore these varied perspectives to better understand the broad mix of expectations in the market.

Explore 6 other fair value estimates on Victoria's Secret - why the stock might be worth as much as 27% more than the current price!

Build Your Own Victoria's Secret Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Victoria's Secret research is our analysis highlighting 2 key rewards and 2 important warning signs that could impact your investment decision.
• Our free Victoria's Secret research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Victoria's Secret's overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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