Robert Way
Investment Action
I give a hold rating for Victoria’s Secret & Co. (NYSE:VSCO) as I think the stock sits at a difficult crossroad. While there are early signs that the turnaround is gaining traction, the core intimates business
Victoria's Secret: I Don't See Any Upside Potential In The Near Term
Summary
- I rate VSCO as hold due to a challenging outlook: early turnaround signs are offset by core business weakness, tariffs, and activist pressure.
- While PINK and international segments show growth, the core intimates category remains soft and faces secular headwinds from shifting consumer preferences.
- Tariff impacts and activist investor scrutiny add further uncertainty, with potential for management changes if results don't improve soon.
- With shares trading near historical averages, I see limited upside and recommend waiting for clearer evidence of a sustained turnaround before buying.
I’m a fundamental, valuation-driven investor with a strong focus on identifying businesses that have the potential to scale over time and unlock massive terminal value. My investment approach centers around understanding the core economics of a business—its competitive moat, unit economics, reinvestment runway, and management quality—and how those factors translate into long-term free cash flow generation and shareholder value creation. I focus on fundamental research, and I tend to focus on sectors with strong secular tailwinds. Professionally, I am a self-educated investor that started this journey 10 years ago. Currently, I am managing my own funds, seeded from friends and family. My motivation for writing on Seeking Alpha is to share investment insights, and also at the same garner feedback from fellow investors in this site. My aim is to help readers focus on what truly drives long-term equity value. I believe good analysis should be both analytical and accessible, and I hope my work adds value to readers looking for high-quality, long-term investment opportunities.
Analyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within 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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