Shares of Bath & Body Works (NYSE: BBWI) are down 8% in pre-open after the company reported Q4 results.

Adjusted EPS from continuing operations came in at $2.30, topping the consensus estimates of $2.27 per share. EPS in the quarter totaled $2.28, down from $3.03 per share in the year-ago period.

Net sales came in at $3.03 billion in Q4, down 37% YOY, and above the analyst consensus of $3.02 billion. The company reported direct sales of $763.9 million, up 1.9% YOY and slightly below consensus estimates of $764.8 million.

For the first quarter, Bath & Body Works expects EPS from continuing operations in the range of $0.47 to $0.55, compared to the $0.60 per share reported in the year-ago period and $0.49 consensus.

For FY 2022, the company expects EPS from continuing operations to range between 4.30 and $4.70, compared to $4.51 adjusted earnings per share from continuing operations in FY 2021, and consensus of $4.28.

The company also said CEO Andrew Meslow will step down in May, due to health reasons. Meslow will be temporarily replaced by Chair of the Board Sarah Nash.

Goldman Sachs analyst Kate McShane reiterated a Buy rating and an $82.00 per share price target on BBWI following earnings.

On the guidance, McShane believes that “management is taking a conservative view given the stimulus lap and ongoing uncertainty with inflationary cost pressures, while also noting this quarter came in higher than the company's original guidance.”

BofA analyst Lorraine Hutchinson is positive on BBWI shares.

“We view BBWI as one of the least expensive growth compounders in retail and the F2022 guidance for flat earnings despite significant cost pressures is encouraging; reiterate Buy. We are disappointed by the announcement of CEO Andrew Meslow’s departure for health reasons, but view Chair of the Board Sarah Nash as a well-qualified interim CEO,” Hutchinson wrote in a memo to clients.

By Senad Karaahmetovic | [email protected]