Collins Stewart Starts Limited Brands (LTD) at Neutral; Believe LTD is Not Fully Maximizing its Global Potential

Collins Stewart initiates coverage on Limited Brands (NYSE: LTD) with a Neutral. PT $42.00.

Collins analyst says, "Limited Brands has sustained healthy sales momentum within its core Victoria Secret and Bath & Body Works concepts, but it faces increasingly difficult comparisons in the near term. Merchandise margins remain under pressure stemming from higher product costs and heightened levels of promotional activity. The company is expanding square footage in both core concepts in Canada at double-digit rates, but we don’t believe LTD is fully realizing its full potential overseas. Shares have appreciated 25% YTD, compared to a 3% decline for the S&P 500 index and the RLX index up 2%. Following the strong run, we believe LTD is fairly valued at 14x our FY12 EPS estimate and 7.5x FY12E EV/EBITDA."

For an analyst ratings summary and ratings history on Limited Brands click here. For more ratings news on Limited Brands click here.

Shares of Limited Brands closed at $37.70 yesterday.

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