Favorable weather conditions and an improving economic
backdrop instilled confidence among consumers that led to strong
spending during the month of May. Amid such a positive scenario
L Brands, Inc.
) posted comparable-store sales growth of 3% for the four-week
period ended Jun 1, 2013, reflecting a sequential improvement of
100 basis points.
This specialty retailer of women's intimate and other apparel,
beauty and personal care products showcased an increase of 9.7%
in net sales of $737 million from $671.9 million in the
prior-year period. In the past few months unseasonable cold
weather dampened the mood of consumers that muted retailers'
performance. However, an improving job market, lower gas prices
and rebound in the housing market boosted consumer sentiment.
Besides Limited Brands, other retail chains that posted
healthy sales data for the month of May, include, clothing chain,
The Gap, Inc.
) that registered comps growth of 7%, the warehouse retailer,
Costco Wholesale Corporation
) delivered comparable-store sales growth of 5%, while retailer
of casual apparels, footwear and accessories for men and women,
) registered a 4.1% rise in comps.
Coming to Limited Brands, comparable-store sales for May
increased 4% at Victoria's Secret Stores & Victoria's Secret
Beauty, 4% at La Senza and 3% at Bath & Body Works & The
White Barn Candle Co. Sales climbed 4% at Victoria's Secret
Direct. Management now projects total comparable-store sales to
rise in the low single-digit for the month of June.
For the seventeen-week period ended Jun 1, 2013,
comparable-store sales jumped 3%, whereas net sales rose 6.3% to
$3,005 million from $2,826 million in the year-ago period.
Limited Brands' Bath & Body Works segment is gaining
traction, driven by a rise in store transactions, enhancement in
the direct channel business and new stores. Victoria's Secret
Stores have been performing well and the company is revamping its
La Senza brand alongside.
Limited Brands is keen on augmenting its retail footprint
across the globe by expanding aggressively in Canada and other
international markets. Moreover, the company's strong liquidity
positions it for growth and higher returns. However, stiff
competition and erratic consumer behavior still remain matters of
concern for this Zacks Rank #3 (Hold) stock.
BUCKLE INC (BKE): Free Stock Analysis Report
COSTCO WHOLE CP (COST): Free Stock Analysis
GAP INC (GPS): Free Stock Analysis Report
L BRANDS INC (LTD): Free Stock Analysis
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