Limited Brands Rises After November Sales Beat Views

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Superstorm Sandy put a damper on November sales of many retailers, butLimited Brands ( LTD ) was one bright spot.

The parent of Victoria's Secret, Bath & Body Works and Pink said its comparable same-store sales for the four weeks ended Nov. 24 rose 5% to $922 million, beating a 3.4% estimate by research firm Retail Metrics. Bad weather brought on by Sandy hurt sales by 1 to 2 percentage points.

Victoria's Secret and Bath & Body Works, which make up the bulk of its total revenue, had record Thanksgiving-weekend sales.

Despite strength in November, overall results have been lackluster in the latest three quarters. Earnings have grown by single digits, while sales fell by single digits.

In its latest results from earlier this month, Limited Brands reported that its Q3 profit rose 4% to 26 cents a share. Revenue fell 6% to $2.05 billion.

But Limited Brands raised its full-year profit outlook to $2.78 to $2.93 a share, or up 6.9% to 12.7%, from a year ago. And it unveiled a $250 million stock buyback program.

The company hit some rough spots in recent years, but has since delivered two straight years of earnings and sales gains. Limited Brands has a three-year Earnings Stability Factor of 13.

The retailer has paid dividends for about 38 years and has steadily increased its payout over time. The company's last hiked its dividend in late January to $1 a share annually, up from 80 cents a share.

Limited Brands has a 1.9% annualized yield, which is about average among the 22 dividend-paying firms in the Retail-Apparel/Shoes/Accessories group.

The company has also paid a number of specials dividends in recent years. In September, it gave shareholders a special payout of $1 a share.

Limited Brands is holding near a record high and has formed a cup-like base with a 52.30 buy point. Technically, the base sits next to another deeper base.

The stock cleared a 50.85 buy point in a cup-with-handle-base Sept. 20 in strong volume. But Limited Brands didn't gain much ground before settling into another consolidation.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

This article appears in: Personal Finance , Investing Ideas

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