Bath & Body Works Faces Weak Sales and Limited Growth Outlook

Bath & Body Works shares had fallen 12% over six months to $16.35, while the S&P 500 gained 16.3%. StockStory said the retailer’s outlook did not justify the risk, citing weaker sales and limited growth prospects.

The publisher said same-store sales, a measure of sales at established stores, declined by an average of 1.7% annually over the past two years. It described the trend as a sign of waning demand.

Wall Street analysts expect revenue to stall over the next 12 months, according to StockStory. The publisher compared that outlook with the company’s 1.1% annualized revenue declines over the past three years.

StockStory also noted that earnings per share grew at a 3.8% compound annual rate over the past three years. It said that growth outpaced revenue, suggesting management adjusted costs as demand weakened.

The publisher said the shares traded at 6.2 times forward earnings at $16.35, a valuation it called fair but with limited upside relative to potential downside.