“What’s that stench? It’s fantastic…”

Well apparently, the company behind my wifes nostalgia-fueled scent hoarding just gave Wall Street something to sniff at: a 17% stock jump on the back of better-than-expected Q3 earnings and a raised forecast for fiscal 2024. What’s even more shocking? I'm talking about Bath & Body Works. 

(Source: Giphy) 

In short, the stock that’s brought its investors nothing but tears (instead of good vibes) this year (down -20.74% YTD), reported $1.61 billion in net sales—a 3% bump from last year and slightly above Wall Street’s $1.58 billion forecast. Earnings per diluted share came in at 49 cents. Now sure, that’s down from last years 52 cents, but it still beat the analysts’ lowball estimate of 47 cents. A wins a win. 

(Source: Yahoo Finance) 

Which is why CEO Gina Boswell was seen declaring  “Our strong results exceeded the high end of our net sales and earnings guidance.” Translation: We friggin ‘crushed it. And with the holidays looming, the company was feeling extra horned up to raise its full-year guidance.Net sales are now expected to fall between a manageable 1.7% and 2.5%—a rosier outlook than the previous 2% to 4% drop. Adjusted earnings per share for 2024 are also getting a subtle boost, now expected to land between $3.15 and $3.28 (up from $3.06 to $3.26).

But, but, but, the stock is down… like bigly down, right? 100%. So what in the hell is driving the optimism, you ask? According to Boswell it’s all credit to “innovation across all categories” for resonating with both new and loyal customers alike. Translation: Apparently people are still willing to line up for a limited-edition peppermint candle like it’s Black Friday at Walmart circa 2012.

(Source: Giphy) 

Now of course, with that said it’s not all sunshine and eucalyptus mint. Q4 sales are projected to take a 4.5% to 6.5% hit, thanks to a shorter holiday season and an extra week in last year’s fiscal calendar. But even with a Grinchy headwind, the company expects earnings between $1.94 and $2.07 per share, which still keeps analysts relatively happy.

And let’s be real: the holiday season is Bath & Body Works’ Super Bowl. The brand’s arsenal of scented candles and gift sets practically prints money when December rolls around. Boswell is confident that their “leadership in home fragrance,” gift options, and pricing strategy will let them finish the year strong. (Pro tip: no one ever hates getting a candle in their Secret Santa… except for, well,.... Guys maybe? But then again, we are living in 2024 where people like Dylan Mulvaney get endorsed by Bud Light LOL). 

(Source: Them) —- LOL of course this comes from a site called “Them”

On the other hand, it’s not just just U.S. malls that are getting a whiff of Bath & Body Works’ success. The company opened its 500th international store last month in London’s Westfield Stratford City mall. That’s its seventh store in the U.K.—and the second in London. Global domination by way of scented soap? Sure, why not. For instance, BBWI now has locations on six continents, operating a franchise model in 40 countries. Most recently, it added South Korea to its growing list.

(Source: AP) 

So what’s the takeaway here? Well simple, Bath & Body Works is proving it’s more than just your go-to stop for three-wick candles and hand soap. With a strong Q3, raised guidance, and a global expansion strategy that smells like success, the stock’s 17% jump feels well earned. So yeah, keep an eye on this stock going forward.

I’m sure there are plenty more surprises to follow. In the meantime, stay safe and stay frosty, friends! Until next time…

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Stocks.News does not hold positions in companies mentioned in the article.