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L Brands Comps Up in September, October View Promising

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L Brands, Inc.’s comparable store sales (comps) for the five weeks ended Oct 1, 2016 increased 3% year over year and also neatly beat analysts' expectations. Moreover, net sales for September rose 6% to $971.4 million.

L Brands’ comps were flat at Victoria’s Secret and increased 9% at Bath & Body Works. On the other hand, for the 35-week period ended Oct 1, 2016, net sales grew 4% to $7.328 billion from $7.023 billion in the prior-year period. Comps jumped 3% over the same period.

The company said that merchandise margin rate fell considerably in September in comparison to last year primarily due to decline in the beauty category. As a result, the company is repositioning the category.

The company further said that in October they will emphasis on pink active bras and sport collection. In October, L Brands expects comps to increase by low-single digits.

L BRANDS INC Price and Consensus

L BRANDS INC Price and Consensus | L BRANDS INC Quote

The company’s sustained focus on cost containment, inventory management, merchandise, and speed-to-market initiatives has kept it afloat in a sluggish consumer environment. We believe that L Brands’ operational efficiencies, together with its new and innovative collections, will drive sales higher. Additionally, the company’s foray into international markets is likely to provide long-term growth opportunities and generate increased sales volumes.

L Brands commands a market leading position in the lingerie, personal care and beauty segments. We believe that the company’s innovation in merchandise and exclusive assortments remain popular among consumers and sets it apart from its peers. Moreover, L Brands with its operational efficiencies, new and innovative assortments remains well positioned to capitalize on the same.

Apart from L Brands, Costco Wholesale Corporation (COST - Free Report) , Zumiez Inc. (ZUMZ - Free Report) and The Buckle, Inc. (BKE - Free Report) came out with their comps results. Costco Wholesale and Zumiez registered an increase of 1% and 6.3%, respectively for the month of September, while Buckle’s comps declined 15.5%.

L Brands currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.

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