From Nasdaq: 2025-04-21 23:25:00

Bath & Body Works stock (BBWI) has already dropped by 27% this year, underperforming the S&P 500. In Q4 2024, the company reported a 4% decline in net sales and an 18% drop in earnings per share due to fiscal calendar shifts and weak consumer demand. New U.S. tariffs on Chinese imports, soft discretionary spending, and competition from private labels add pressure.

BBWI stock could face significant sell-offs during downturns, as seen in previous instances where it lost up to 64% of its value. With mounting challenges like new tariffs and economic uncertainty, the stock may drop further. Consider a High-Quality portfolio for growth with reduced volatility compared to individual stocks like BBWI.

New U.S. tariffs impact BBWI’s supply chain costs but its U.S.-based supply chain offers a buffer against global trade disruptions. Despite cost increases, the focus on domestic sourcing may be a strategic advantage over competitors reliant on international suppliers. This could differentiate BBWI in uncertain trade environments, affecting investor sentiment and stock volatility.

BBWI stock has shown worse performance than the S&P 500 in recent downturns. In the inflation shock of 2022, it fell by 63.9%, faring worse than the S&P 500. Current trading at around $28 per share, BBWI is valued at 8x the consensus 2025 earnings estimate, with an average price target of $44 indicating potential growth. Management guides for modest sales and earnings growth in 2025, reflecting cautious optimism amidst macroeconomic challenges.

Considering the potential slowdown in growth and economic uncertainties, investors must decide whether to hold onto BBWI stock during declines. Trefis recommends a High-Quality portfolio for better returns and less risk during market turbulence. Evaluate your options and decide whether to stay invested or explore alternative investment strategies for a more stable return on your investments.



Read more at Nasdaq: Is A 60% Drop Ahead For Bath & Body Works Stock?