A strong stock as of late has been Victoria's Secret (VSXY). Shares have been marching higher, with the stock up 22.8% over the past month. The stock hit a new 52-week high of $94.34 in the previous session. Victoria's Secret has gained 72.6% since the start of the year compared to the 7.1% gain for the Zacks Retail-Wholesale sector and the -1.3% return for the Zacks Retail - Apparel and Shoes industry.
What's Driving the Outperformance?
The stock has a great record of positive earnings surprises, having beaten the Zacks Consensus Estimate in each of the last four quarters. In its last earnings report on June 2, 2026, Victoria's Secret reported EPS of $0.6 versus consensus estimate of $0.29.
For the current fiscal year, Victoria's Secret is expected to post earnings of $4.67 per share on $7.15 in revenues. This represents a 55.67% change in EPS on a 11.9% change in revenues. For the next fiscal year, the company is expected to earn $5.56 per share on $7.5 in revenues. This represents a year-over-year change of 19.23% and 4.88%, respectively.
Valuation Metrics
Victoria's Secret may be at a 52-week high right now, but what might the future hold for the stock? A key aspect of this question is taking a look at valuation metrics in order to determine if the company is due for a pullback from this level.
On this front, we can look at the Zacks Style Scores, as these give investors a variety of ways to comb through stocks (beyond looking at the Zacks Rank of a security). The individual style scores for Value, Growth, Momentum and the combined VGM Score run from A through F. The idea behind the style scores is to help investors pick the most appropriate Zacks Rank stocks based on their individual investment style.
Victoria's Secret has a Value Score of B. The stock's Growth and Momentum Scores are B and F, respectively, giving the company a VGM Score of B.
In terms of its value breakdown, the stock currently trades at 20X current fiscal year EPS estimates, which is a premium to the peer industry average of 17.4X. On a trailing cash flow basis, the stock currently trades at 15.4X versus its peer group's average of 9.6X. Additionally, the stock has a PEG ratio of 0.73. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
Zacks Rank
We also need to consider the stock's Zacks Rank, as this supersedes any trend on the style score front. Fortunately, Victoria's Secret currently has a Zacks Rank of #1 (Strong Buy) thanks to favorable earnings estimate revisions from covering analysts.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if Victoria's Secret passes the test. Thus, it seems as though Victoria's Secret shares could still be poised for more gains ahead.
How Does VSXY Stack Up to the Competition?
Shares of VSXY have been soaring, and the company still appears to be a decent choice, but what about the rest of the industry? One industry peer that looks good is Designer Brands Inc. (DBI). DBI has a Zacks Rank of #2 (Buy) and a Value Score of A, a Growth Score of A, and a Momentum Score of F.
Earnings were strong last quarter. Designer Brands Inc. beat our consensus estimate by 250.00%, and for the current fiscal year, DBI is expected to post earnings of $0.38 per share on revenue of $2.91 billion.
Shares of Designer Brands Inc. have gained 22.1% over the past month, and currently trade at a forward P/E of 17.42X and a P/CF of 4.9X.
The Retail - Apparel and Shoes industry is in the top 39% of all the industries we have in our universe, so it looks like there are some nice tailwinds for VSXY and DBI, even beyond their own solid fundamental situation.
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