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Can Victoria's Secret's Path to Potential Sustain Broad-Based Growth?
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Key Takeaways
VSXY's sales rose 10% to $1.61 billion in the second quarter, marking the fifth quarter of positive comps.
Bras grew mid-teens, while PINK and Beauty extended growth streaks across key categories.
VSXY's customer file grew mid-single digits, with new-customer acquisition up high single digits.
Victoria’s Secret & Co. (VSXY - Free Report) continues to make meaningful progress under its Path to Potential strategy, which aims to build Victoria’s Secret and PINK into two distinct world-class growth brands supported by a powerhouse Beauty business. The company continued to make tangible progress toward this objective during the quarter, with performance remaining broad-based. Growth continued across Victoria’s Secret, PINK and Beauty, as well as across channels, highlighting the breadth of the company’s progress under the strategy.
In the second quarter of fiscal 2026, net sales rose 10% year over year to $1,611 million, marking the company’s fifth consecutive quarter of positive comparable sales, while adjusted operating income increased 125% to $124 million. The strategy is being supported by renewed strength in its core categories. The bra business grew mid-teens, with bras contributing approximately half of Victoria’s Secret’s mid-teens brand growth. This momentum also extended into adjacent categories, with panties growing high-teens and sleep mid-teens.
PINK is also gaining traction, growing high single digits for its fifth consecutive quarter, while apparel delivered its eighth consecutive quarter of growth. Meanwhile, Beauty grew mid-single digits, extending its growth streak to 12 consecutive quarters, supported by strength in fine fragrance and mist and continued product innovation.
Customer momentum provides another source of growth. The customer file increased mid-single digits, with new-customer acquisition growing high single digits, while regular-price selling increased low double digits. International sales also grew 20%, led by China and the European digital business.
Overall, the company’s broad-based performance across brands, categories and channels, alongside continued customer growth and product innovation, provides multiple areas of momentum as Victoria’s Secret continues to execute its Path to Potential strategy.
The Zacks Rundown for VSXY
Shares of this Zacks Rank #3 (Hold) company have gained 3.6% in the past three months against the industry’s decline of 14.7%.
Image Source: Zacks Investment Research
From a valuation standpoint, VSXY trades at a forward price-to-earnings ratio of 15.18, higher than the industry’s average of 11.83.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for VSXY’s current and next fiscal year earnings implies a year-over-year rise of 56.3% and 22.7%, respectively.
Image Source: Zacks Investment Research
Stocks to Consider
Some better-ranked stocks have been discussed below:
The Zacks Consensus Estimate for FIGS’s current fiscal-year sales and earnings implies growth of 19.7% and 89.5%, respectively, from the year-ago figures. FIGS has delivered a trailing four-quarter earnings surprise of 201.8%, on average.
Fossil Group, Inc. (FOSL - Free Report) designs, develops, markets, and distributes consumer fashion accessories in the United States, Europe, Asia, and internationally. At present, FOSL carries a Zacks Rank of 2.
The Zacks Consensus Estimate for FOSL’s current fiscal-year sales indicates a decline of 4%, while the same for earnings indicates growth of 96.7% from the year-ago figures. FOSL delivered a trailing four-quarter negative earnings surprise of 236.2%, on average.
Boot Barn Holdings, Inc. (BOOT - Free Report) operates specialty retail stores in the United States and internationally. At present, Boot Barn carries a Zacks Rank of 2.
The consensus estimate for Boot Barn’s current fiscal-year sales and earnings implies growth of 15.8% and 23.5%, respectively, from the year-ago figures. BOOT delivered a trailing four-quarter earnings surprise of 11.4%, on average.
View the Zacks #1 Rank List
Image: Bigstock
Can Victoria's Secret's Path to Potential Sustain Broad-Based Growth?
Key Takeaways
Victoria’s Secret & Co. (VSXY - Free Report) continues to make meaningful progress under its Path to Potential strategy, which aims to build Victoria’s Secret and PINK into two distinct world-class growth brands supported by a powerhouse Beauty business. The company continued to make tangible progress toward this objective during the quarter, with performance remaining broad-based. Growth continued across Victoria’s Secret, PINK and Beauty, as well as across channels, highlighting the breadth of the company’s progress under the strategy.
In the second quarter of fiscal 2026, net sales rose 10% year over year to $1,611 million, marking the company’s fifth consecutive quarter of positive comparable sales, while adjusted operating income increased 125% to $124 million. The strategy is being supported by renewed strength in its core categories. The bra business grew mid-teens, with bras contributing approximately half of Victoria’s Secret’s mid-teens brand growth. This momentum also extended into adjacent categories, with panties growing high-teens and sleep mid-teens.
PINK is also gaining traction, growing high single digits for its fifth consecutive quarter, while apparel delivered its eighth consecutive quarter of growth. Meanwhile, Beauty grew mid-single digits, extending its growth streak to 12 consecutive quarters, supported by strength in fine fragrance and mist and continued product innovation.
Customer momentum provides another source of growth. The customer file increased mid-single digits, with new-customer acquisition growing high single digits, while regular-price selling increased low double digits. International sales also grew 20%, led by China and the European digital business.
Overall, the company’s broad-based performance across brands, categories and channels, alongside continued customer growth and product innovation, provides multiple areas of momentum as Victoria’s Secret continues to execute its Path to Potential strategy.
The Zacks Rundown for VSXY
Shares of this Zacks Rank #3 (Hold) company have gained 3.6% in the past three months against the industry’s decline of 14.7%.
Image Source: Zacks Investment Research
From a valuation standpoint, VSXY trades at a forward price-to-earnings ratio of 15.18, higher than the industry’s average of 11.83.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for VSXY’s current and next fiscal year earnings implies a year-over-year rise of 56.3% and 22.7%, respectively.
Image Source: Zacks Investment Research
Stocks to Consider
Some better-ranked stocks have been discussed below:
FIGS, Inc. (FIGS - Free Report) operates as a direct-to-consumer healthcare apparel and lifestyle company in the United States and internationally. At present, FIGS carries a Zacks Rank of 2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for FIGS’s current fiscal-year sales and earnings implies growth of 19.7% and 89.5%, respectively, from the year-ago figures. FIGS has delivered a trailing four-quarter earnings surprise of 201.8%, on average.
Fossil Group, Inc. (FOSL - Free Report) designs, develops, markets, and distributes consumer fashion accessories in the United States, Europe, Asia, and internationally. At present, FOSL carries a Zacks Rank of 2.
The Zacks Consensus Estimate for FOSL’s current fiscal-year sales indicates a decline of 4%, while the same for earnings indicates growth of 96.7% from the year-ago figures. FOSL delivered a trailing four-quarter negative earnings surprise of 236.2%, on average.
Boot Barn Holdings, Inc. (BOOT - Free Report) operates specialty retail stores in the United States and internationally. At present, Boot Barn carries a Zacks Rank of 2.
The consensus estimate for Boot Barn’s current fiscal-year sales and earnings implies growth of 15.8% and 23.5%, respectively, from the year-ago figures. BOOT delivered a trailing four-quarter earnings surprise of 11.4%, on average.