Bath & Body Works: Short-Term Pain Provides An Attractive Entry Point

Summary

  • Bath & Body Works is a retail that specializes in personal care and home fragrance products.
  • The brand has crafted its identity around providing a sensory in-store experience, limiting the risk of being replaced by e-commerce.
  • During the 2008 crisis, B&BW experienced a sales decrease of only 2%, which shows its ability to resist crises.
  • The current valuation is highly attractive because it is already priced in a negative scenario.

Punto de venta de Bath & Body Works en KLCC Kuala Lumpur, Malasia

tang90246/iStock Editorial via Getty Images

Investment Thesis

Bath & Body Works (NYSE:BBWI) is an intriguing tale of a company that, in the past, was somewhat overshadowed by Victoria's Secret, hindering its remarkable growth and margins. Recognizing the need for independence, the board made

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I'm a long-term, fundamentals-focused investor who is interested in quality and growth opportunities mostly, but I like to search for deep value/turnaround situations as well.

Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, but may initiate a beneficial Long position through a purchase of the stock, or the purchase of call options or similar derivatives in BBWI over the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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