Bath & Body Works Inc. (NYSE: NYSE:BBWI) has maintained its Outperform rating and $50.00 price target from BMO Capital.
The affirmation comes following the announcement of the departure of the company's President of Retail.
BMO Capital notes that despite the departure being a significant change, the firm believes that Bath & Body Works' management is confident in its current standing after last year's management changes.
The company's decision to part ways with the President of Retail was seen as a move to eliminate what was considered a redundant and costly position, with the Chief Merchant continuing to report directly to the CEO. This streamlining comes as the company upholds its financial guidance for the third quarter and full year.
BMO Capital expressed a sentiment of understanding regarding the decision, despite acknowledging the former executive's talent and popularity.
The analyst stated, "Although we're sad to see Ms. Rosen go, and are excited to see her succeed in her next chapter, we understand the decision."
Bath & Body Works' management has not wavered in its financial outlook, reiterating its previous guidance for the upcoming quarter and the fiscal year. This move indicates stability and confidence in the company's strategic direction and financial health.
In other recent news, Bath & Body Works reported the departure of Julie Rosen, the President of Retail, as part of a restructuring strategy. Her responsibilities will now be managed by the CEO, Gina Boswell. Despite this significant shift, Bath & Body Works remains steadfast in its financial guidance for the third quarter and the full year of 2024.
In terms of financial performance, Bath & Body Works reported an earnings per share increase, surpassing expectations despite weaker-than-anticipated sales in the second quarter of 2024.
The company has revised its full-year 2024 sales guidance downward, now projecting a decrease of 4% to 2%. Additionally, Bath & Body Works raised its cost optimization savings target to $130 million from $100 million and plans to repurchase $400 million in shares.
Several analyst firms, including Baird, Morgan Stanley, and BofA Securities, have adjusted their price targets for Bath & Body Works. Baird maintains an Outperform rating with a steady price target of $45, while Morgan Stanley reaffirmed its Overweight rating but reduced the price target to $51. BofA Securities retained a Buy rating but cut the target to $45.
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