FINWIRES · TerminalLIVE
FINWIRES

Bath & Body Works Faces Long-Term Margin Headwinds Amid Business Revamp, UBS Says

By

Bath & Body Works (BBWI) is entering a "multiyear process" to revamp direct-to-consumer sales growth, though risks tied to its expansion into Amazon.com (AMZN) and other mass retail channels could pressure long-term margins, UBS Securities said in a report emailed Thursday.

The firm said improving product assortments, brand positioning and operating models will take time, while broader wholesale distribution could cannibalize the company's direct-to-consumer business and create structural margin headwinds.

Bath & Body Works reiterated its fiscal 2026 earnings guidance of $2.40 to $2.65 per share after Q1 results, while its management said its Amazon rollout has delivered double-digit week-over-week growth since February and attracted "younger and more affluent consumers," the report said.

While the company continues to plan to deliver $175 million in cost savings this fiscal year, its international business faces substantial pressure, according to the report.

UBS maintained a neutral rating on Bath & Body Works with a price target of $19.

Price: $20.14, Change: $+0.69, Percent Change: +3.55%

Related Articles

Wire

Dell Technologies Unit Wins $9.69 Billion US Navy Contract

Dell Technologies (DELL) unit Dell Federal Systems won a blanket purchase agreement with an overall estimated value of $9.69 billion from the US Navy under the Department of Defense Enterprise Software Initiative.The agreement will streamline software acquisition across the Defense Department, the intelligence community, and the US Coast Guard, according to a statement.The deal will allow clients to procure Microsoft (MSFT) software licenses, cloud subscriptions, and Software Assurance, according to the Department.

$DELL$MSFT
Wire

Dave to Replace American Woodmark in S&P SmallCap 600

Dave (DAVE) is set to replace American Woodmark (AMWD) in the S&P SmallCap 600 before trading begins Monday, S&P Dow Jones Indices said.MasterBrand (MBC) is acquiring American Woodmark in a deal expected to close May 29, the S&P Global (SPGI) unit said Wednesday in a statement.Dave shares rose 4.2% in after-hours trading.

$AMWD$DAVE$SPGI
Wire

Citi Trends Reports Preliminary Fiscal Q1 Sales, Lifts FY Comparable-Store Sales Outlook

Citi Trends (CTRN) reported fiscal Q1 preliminary sales late Wednesday of $230.9 million and raised its full-year outlook for comparable-store sales growth.A year earlier, sales were $201.7 million.Comparable-store sales growth in fiscal 2026 is expected to range from 8% to 10%, compared with the prior 5% to 7% forecast, the company said.Citi Trends also lifted its full-year adjusted EBITDA guidance to $35 million to $40 million from the previous outlook of $34 million to $38 million.Citi Trends shares rose 10% in after-hours trading.

$CTRN