Bath & Body Works Inc. (BBWI) PT Raised to $36 at UBS

UBS analyst Jay Sole raised the price target on Bath & Body Works Inc. (NYSE: BBWI) to $36.00 (from $32.00) while maintaining a Neutral rating.

The analyst commented, "BBWI preannounced Q1 EPS on May 19th along with its announcement Daniel Heaf will replace Gina Boswell as CEO. BBWI also reiterated its FY25 EPS guidance of $3.25-$3.60. Therefore, we believe the stock's move will hinge on the market's reaction to Mr. Heaf's new strategic initiatives, if offered, and BBWI's FY25 and Q2 guidance updates. We believe Mr. Heaf's comments likely point to an acceleration of strategic investment in marketing over the NTM. However, we doubt this investment drives a material change to the company's existing outlook. We therefore anticipate BBWI reiterates its current FY25 EPS outlook. Therefore, we don't expect BBWI's Q1 report to cause Street estimates to change much. Plus, we believe investors expect a similar outcome. Thus, we don't expect the report to change BBWI's P/E much. This causes us to see a balanced upside/downside skew around the event. The options market is pricing in a +/- 9.0% jump over the event vs. a 7.0% historical average move. We expect a relatively low-vol event."

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