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Bath & Body Works Inc. (BBWI) Stock

Bath & Body Works Inc. Stock Details, Movements and Public Alerts

Bath & Body Works (BBWI): The $6.5B Fragrance Retailer With New CEO After Gina Boswell's May 2025 Exit

When Daniel Heaf became Bath & Body Works CEO in May 2025, he replaced Gina Boswell who departed after guiding fiscal 2025 outlook (1-3% sales growth, $3.25-$3.60 EPS) that disappointed Wall Street expecting faster growth. CEO Heaf, a Nike veteran, inherits a $6.5B fragrance retail business operating 1,895 U.S./Canada stores and 529 international franchised locations selling signature products: 3-wick candles, fine fragrance mists, body lotions, soaps. Q1 fiscal 2025 showed resilience: $1.42B sales (+3% YoY), $0.49 EPS (beating $0.38 prior year and exceeding guidance high end). However, the muted 1-3% full-year growth outlook reflects consumer spending pressures (inflation reducing discretionary purchases), mall traffic declines (80%+ stores in malls), and cannibalization from White Barn brand expansion. Bath & Body Works maintains pricing power through seasonal product launches (fall candles, holiday gift sets) and loyalty program (65M+ members), but competition from Target/Walmart private label and e-commerce (Amazon) erodes margins. At current valuation, BBWI offers stable dividend income (yielding 4-5%) and modest growth—suitable for defensive retail exposure but lacking catalysts for multiple expansion.

52-Week Range

$41.27 - $24.60

-40.47% from high · +-0.12% from low

Avg Daily Volume

61,817

Latest volume

Fundamentals

Valuation Metrics

P/E Ratio (TTM)

7.97

Below market average

Forward P/E

7.62

Earnings expected to grow

PEG Ratio

0.81

Potentially undervalued

EV/EBITDA

6.50

EPS (TTM)

$3.27

Price to Sales

0.75

Beta

1.46

Similar volatility to market

How is BBWI valued relative to its earnings and growth?
Bath & Body Works Inc. trades at a P/E ratio of 7.97, which is below the market average of approximately 20. This lower valuation could indicate the market has modest growth expectations, or it might represent an undervalued opportunity if the fundamentals are strong. Looking ahead, the forward P/E of 7.62 is lower than the current P/E, indicating analysts expect earnings to grow over the next year. The PEG ratio of 0.81 suggests the stock may be undervalued relative to its growth rate.
What is BBWI's risk profile compared to the market?
With a beta of 1.46, Bath & Body Works Inc. is roughly as volatile as the market, moving in line with broad market trends. This moderate beta suggests the stock offers market-level returns without excessive volatility.

Performance & Growth

Profit Margin

9.88%

Operating Margin

10.10%

EBITDA

$1.53B

Return on Equity

0.00%

Return on Assets

16.20%

Revenue Growth (YoY)

1.50%

Earnings Growth (YoY)

-55.90%

How profitable and efficient is BBWI's business model?
Bath & Body Works Inc. achieves a profit margin of 9.88%, meaning it retains $9.88 from every $100 in revenue after all expenses. This represents a solid margin typical of well-run businesses, showing the company can effectively balance revenue generation with cost control. The operating margin of 10.10% reveals how efficiently the company runs its core business operations before interest and taxes.0
What are BBWI's recent growth trends?
Bath & Body Works Inc.'s revenue grew by 1.50% year-over-year, showing steady progress in growing the business. This positive trajectory indicates the company maintains competitive positioning in its markets. Earnings decreased by 55.90% year-over-year, reflecting the bottom-line impact of business performance. These growth metrics should be evaluated against SPECIALTY RETAIL industry averages for proper context.

Dividend Information

Dividend Per Share

$0.80

Dividend Yield

3.00%

Ex-Dividend Date

Aug 22, 2025

Dividend Date

Sep 5, 2025

What dividend income can investors expect from BBWI?
Bath & Body Works Inc. offers a dividend yield of 3.00%, paying $0.80 per share annually. This above-average yield of 2-4% provides meaningful income while still allowing the company to reinvest for growth. It compares favorably to the S&P 500 average and offers competitive returns versus bonds in the current rate environment. To receive the next dividend, shares must be purchased before the ex-dividend date of Aug 22, 2025.
How reliable is BBWI's dividend for long-term investors?
The dividend sustainability can be assessed through the payout ratio - Bath & Body Works Inc. pays $0.80 per share in dividends against earnings of $3.27 per share, resulting in a payout ratio of 24.46%. This conservative payout below 30% indicates excellent dividend safety with substantial room for future increases. The company retains most earnings for growth while still rewarding shareholders. The next dividend payment is scheduled for Sep 5, 2025.

Company Size & Market

Market Cap

$5.5B

Revenue (TTM)

$7.37B

Revenue/Share (TTM)

$34.44

Shares Outstanding

206.19M

Book Value/Share

-$7.44

Asset Type

Common Stock

What is BBWI's market capitalization and position?
Bath & Body Works Inc. has a market capitalization of $5.5B, classifying it as a mid-cap stock ($2B-$10B). Mid-caps often represent companies in their growth phase, offering higher growth potential than large-caps but with more stability than small-caps. They can be attractive takeover targets and may become tomorrow's large-caps. With 206.19M shares outstanding, the company's ownership is relatively concentrated. As a participant in the SPECIALTY RETAIL industry, it competes with other firms in this sector.
How does BBWI's price compare to its book value?
Bath & Body Works Inc.'s book value per share is -$7.44, while the current stock price is $24.57, resulting in a price-to-book (P/B) ratio of -3.30. Trading below book value can indicate the market perceives challenges ahead, or it might represent a value opportunity if the assets are quality and earnings can recover. Value investors often screen for P/B ratios below 1.0. As a common stock, this represents equity ownership with voting rights.

Analyst Ratings

Analyst Target Price

$40.67

65.53% upside potential

Analyst Recommendations

Strong Buy

3

Buy

9

Hold

4

Sell

0

Strong Sell

0

How reliable are analyst predictions for BBWI?
16 analysts cover BBWI with 75% recommending buy/strong buy ratings. Analyst predictions have mixed reliability - studies show consensus rarely beats market returns consistently. The strong bullish consensus may already be priced in. The consensus target of $40.67 implies 65.5% upside, but targets are often adjusted to follow price moves rather than predict them.
What is the Wall Street consensus on BBWI?
Current analyst recommendations:3 Strong Buy, 9 Buy, 4 Hold, 00The bullish tilt suggests optimism about future prospects, though investors should conduct independent research.Remember that analyst opinions often lag price movements and can be influenced by investment banking relationships.

Fundamentals last updated: Oct 1, 2025, 06:33 AM

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Bath & Body Works (BBWI) Stock Analysis 2025: Complete Investment Guide

Bath & Body Works Inc. (NYSE: BBWI) operates as North America's largest specialty retailer of personal care and home fragrance products, generating $1.42B quarterly revenue (Q1 fiscal 2025) from 1,895+ company-operated stores in U.S./Canada and 529 international franchised locations. New CEO Daniel Heaf, appointed May 2025 after Gina Boswell's departure, leads a business known for signature products: 3-wick candles (40%+ of sales), body care (lotions, mists, shower gels), hand soaps, and home fragrance diffusers across Bath & Body Works and White Barn brands. The company's competitive position rests on brand equity (65M+ loyalty members), mall anchor status (driving foot traffic), and product innovation (seasonal launches create urgency). However, mall traffic structural decline (e-commerce shift), consumer spending pressure (inflation), and private label competition (Target, Walmart) threaten growth. Trading at modest valuation with 4-5% dividend yield, BBWI offers defensive retail exposure—but CEO transition uncertainty and muted 1-3% growth outlook limit upside. For income investors seeking retail dividends, BBWI merits consideration; growth investors should avoid given limited expansion opportunities.

Business Model & Competitive Moat

Bath & Body Works' business model generates revenue by selling personal care and home fragrance products through company-operated stores (1,895 locations), e-commerce (digital channel growing), and international franchises (529 locations). Daniel Heaf's strategic priority is maintaining same-store sales growth through product innovation (seasonal launches, limited editions), expanding White Barn luxury brand, and optimizing store footprint (closing underperforming mall locations while testing off-mall formats). The competitive moat rests on brand loyalty (65M+ rewards members creating repeat purchases), product differentiation (signature scents unavailable elsewhere), and real estate expertise (profitable mall locations despite traffic declines). However, this moat weakens as Target/Walmart launch private label fragrances at 50% discounts, Amazon offers convenience without mall visits, and TikTok trends (dupe culture) direct customers to cheaper alternatives. Daniel Heaf must prove Bath & Body Works maintains pricing power (currently strong—customers pay $17-30 for candles) and store productivity despite structural mall headwinds. Q1 fiscal 2025 results ($1.42B sales, +3% YoY) show stability, but full-year 1-3% growth reflects market maturity requiring portfolio refresh or M&A to accelerate.

Financial Performance

MetricQ1 FY2025Context
Market Cap$6.5BDown from $15B+ peak 2021
Net Sales$1.42B+3% YoY (high end of guidance)
EPS$0.49vs $0.38 prior year, exceeded guidance
FY2025 Sales Growth1-3%Below analyst expectations
FY2025 EPS Guidance$3.25-$3.60Maintained outlook
Store Count1,895 (US/Canada)+529 international franchised
Dividend Yield~4-5%Attractive for income investors

Bath & Body Works reported Q1 fiscal 2025 sales of $1.42B (+3% YoY) at guidance high end, with EPS of $0.49 exceeding expectations ($0.38 prior year). However, full-year fiscal 2025 guidance of 1-3% sales growth and $3.25-$3.60 EPS disappointed analysts expecting 4-5% growth, causing stock decline despite earnings beat. The muted outlook reflects consumer spending caution (inflation reducing discretionary purchases), mall traffic headwinds (80%+ stores in mall locations), and Q1 outperformance potentially pulling forward demand from later quarters. At $6.5B market cap (down from $15B+ 2021 peak), BBWI trades at modest valuation (10-12x forward earnings) with 4-5% dividend yield providing downside support. Daniel Heaf's challenge is proving 1-3% growth sustainable—requires maintaining pricing power (no promotional spiral), optimizing store base (closing 20-30 underperforming locations annually), and expanding e-commerce/international to offset U.S. same-store sales pressure. The CEO transition adds uncertainty—Gina Boswell's departure after just 2.5 years suggests strategic disagreements or board frustration with growth slowdown.

Growth Catalysts

  • •White Barn Expansion: Luxury brand targeting higher-income customers with premium pricing (candles $30+ vs $17-25 Bath & Body Works)
  • •International Franchising: 529 franchised locations today, potential for 1,000+ as brand expands to Europe/Asia markets
  • •E-Commerce Growth: Digital channel gaining share; omnichannel customers spend 2-3x more than store-only shoppers
  • •Product Innovation: Seasonal launches (fall candles, holiday gift sets) drive 40-50% of annual sales in Q3/Q4
  • •Off-Mall Store Formats: Testing strip center/standalone locations reducing mall traffic dependency

Risks & Challenges

  • •Mall Traffic Structural Decline: 80%+ stores in malls; foot traffic down 30-40% from pre-COVID levels as e-commerce gains
  • •Consumer Spending Pressure: Inflation reducing discretionary income; candles/body care are deferrable purchases during recessions
  • •Private Label Competition: Target, Walmart launching home fragrance brands at 50% discounts to Bath & Body Works
  • •CEO Transition Uncertainty: Daniel Heaf's May 2025 appointment creates strategic uncertainty; Gina Boswell's departure after 2.5 years suggests execution challenges
  • •TikTok Dupe Culture: Social media directing customers to cheaper alternatives (dupes) reducing brand loyalty among Gen Z
  • •Promotional Dependency: Semi-annual sale and candle day promotions (70%+ of customers buy on sale) compress margins

Who Is This Stock Suitable For?

Perfect For

  • ✓Income investors seeking retail dividends (4-5% yield with sustainable payout)
  • ✓Defensive retail exposure (recession-resistant vs apparel, restaurants)
  • ✓Value investors betting on turnaround under new CEO Daniel Heaf
  • ✓Consumer brand investors with 3-5 year horizons accepting 1-3% growth

Less Suitable For

  • ✗Growth investors (1-3% sales growth uninspiring)
  • ✗Mall retail bears expecting further traffic declines
  • ✗E-commerce disruptors (80%+ physical store dependency)
  • ✗Short-term traders (lack of catalysts for quick moves)

Investment Thesis

The bull case for Bath & Body Works assumes Daniel Heaf successfully stabilizes business—maintaining 1-3% same-store sales growth through product innovation, expanding White Barn luxury brand capturing higher-income customers, and accelerating international franchising (1,000+ locations potential). If BBWI demonstrates pricing power resilience (no promotional spiral), optimizes store portfolio (closing 50-100 underperforming malls over 3-5 years), and grows e-commerce to 25-30% of sales (currently 20%), the stock could re-rate to 14-16x earnings (retail specialty average), implying 30-50% upside to $50-55. The 4-5% dividend yield provides income cushion, and seasonal cash flow generation (Q3/Q4 holiday strength) supports capital returns. For defensive retail investors, BBWI offers stable dividends and modest growth at reasonable valuation.

The bear case envisions consumer spending recession—discretionary purchases (candles, body care) declining 10-15% as households prioritize essentials, Bath & Body Works forced into promotional spiral (70%+ discounts) destroying margins. Mall traffic continues structural decline (down another 20-30% over 3-5 years), requiring 200-300 store closures and associated restructuring charges. Private label competition (Target, Walmart) captures 10-15% market share with 50% price discounts, and TikTok dupe culture accelerates brand erosion among Gen Z. Daniel Heaf's CEO transition also creates execution risk—strategy changes, management turnover, or missteps during transformation causing 1-3% growth to turn negative. At 10-12x earnings, market already prices modest pessimism, but recession scenario compresses valuation to 6-8x (2020 levels), implying 30-40% downside to $25-28. Dividend cut unlikely given strong cash generation, but growth stagnation makes BBWI dead money.

Conclusion

Bath & Body Works represents a mature specialty retail investment—dominant North American fragrance retailer ($6.5B market cap, 1,895+ stores) offering stable dividends (4-5% yield) but limited growth (1-3% sales outlook). New CEO Daniel Heaf faces structural headwinds: mall traffic declining 30-40% from pre-COVID, consumer spending pressure, and private label competition from Target/Walmart. However, Bath & Body Works maintains competitive advantages: 65M+ loyalty members, pricing power (customers pay $17-30 for candles despite alternatives), and seasonal product launches driving urgency. Q1 fiscal 2025 results ($1.42B sales, +3% YoY, $0.49 EPS beating guidance) demonstrate operational resilience, but muted full-year outlook (1-3% growth, $3.25-$3.60 EPS) disappointed growth-hungry investors. At current valuation (10-12x forward earnings), BBWI offers asymmetric risk/reward for income investors—downside protected by 4-5% dividend yield and reasonable valuation, upside exists if Daniel Heaf executes turnaround (White Barn expansion, international growth, e-commerce acceleration). However, most investors should avoid BBWI—better risk/reward exists in faster-growing consumer brands (Ulta, Sephora parent LVMH) or higher-yielding retail REITs without mall exposure. For defensive portfolios seeking retail dividend income, BBWI merits 2-3% allocation accepting 1-3% growth and CEO transition uncertainty. Wait for 2-3 quarters of Daniel Heaf execution evidence before increasing position, or avoid entirely if unable to tolerate 20-30% drawdowns during consumer recessions. This is income-focused defensive retail, not growth story.
Bull Case (Successful Turnaround)
$50-55 (30-50% upside)
Base Case (Stable Dividends)
$38-45 (flat to 20% upside)
Bear Case (Consumer Recession)
$25-30 (30-40% downside)

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