Victoria’s Secret shares rise on share buyback plans, holiday sales growth
On April 22nd, 2021, shoppers pass by a Victoria’s Secret shop at the San Diego Mall.
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Victoria’s SecretShares rose Wednesday morning after the retailer of lingerie announced that it would be buying back shares and had reported strong holiday sales.
The stock has risen by about 8% during premarket trading. Its shares were closed Tuesday at $48.58, giving the company a market capitalization of $4.29 trillion.
Victoria’s Secret has teamed up with Goldman Sachs in an accelerated stock purchase program to buy $250 million worth of stock. It said that the plan is expected to be finalized by the close of the first quarter in 2022. The company will get an initial 4 million shares of stock, Dec. 31.
Victoria’s Secret wants to make a comeback after decades of falling sales and declining relevance among women. After splitting from L Brands, it began to revamp its image. They have removed the emphasis on sexy models. It has also ditched its iconic fashion showThe event featured models dressed in the most extravagant bras, dark underwear, and angel wings.
Marvin Waters CEO stated that his company attracted customers during holiday peak times. Sales grew on Thanksgiving weekend and the retailer had “large rushes of business ahead of Christmas.” Waters stated that the retailer had inventory available for its semiannual sale.
Reaffirming its fourth-quarter outlook, which was shared by the company in November, the company reiterated. The company said that sales would be flat to up by 3% over last year’s fourth-quarter forecast and that diluted earnings per share would be between $2.35 and $2.65.
Waters explained that the share purchase plan shows Waters’ confidence in the fact that it “stabilized the business and provided a platform to future growth.”