Victoria's Secret & Co.
Victoria's Secret & Co. Fundamental Analysis
Victoria's Secret & Co. (VSCO) shows moderate financial fundamentals with a PE ratio of 28.50, profit margin of 2.67%, and ROE of 26.07%. The company generates $6.3B in annual revenue with weak year-over-year growth of 0.78%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 35.0/100 based on profitability, valuation, growth, and balance sheet metrics. The F grade reflects weak fundamentals and significant financial concerns.
Fundamental Health Score
We analyze VSCO's fundamental strength across five key dimensions:
Efficiency Score
WeakVSCO struggles to generate sufficient returns from assets.
Valuation Score
WeakVSCO trades at a premium to fair value.
Growth Score
ModerateVSCO shows steady but slowing expansion.
Financial Health Score
ModerateVSCO shows balanced financial health with some risks.
Profitability Score
ModerateVSCO maintains healthy but balanced margins.
Key Financial Metrics
Is VSCO Expensive or Cheap?
P/E Ratio
VSCO trades at 28.50 times earnings. This indicates a fair valuation.
PEG Ratio
When adjusting for growth, VSCO's PEG of 2.05 indicates potential overvaluation.
Price to Book
The market values Victoria's Secret & Co. at 7.45 times its book value. This suggests the stock is fully valued or overvalued on an asset basis.
EV/EBITDA
Enterprise value stands at 0.59 times EBITDA. This is generally considered low.
How Well Does VSCO Make Money?
Net Profit Margin
For every $100 in sales, Victoria's Secret & Co. keeps $2.67 as profit after all expenses.
Operating Margin
Core operations generate 4.85 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $26.07 in profit for every $100 of shareholder equity.
ROA
Victoria's Secret & Co. generates $3.32 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Victoria's Secret & Co. generates limited operating cash flow of $495.49M, signaling weaker underlying cash strength.
Free Cash Flow
Victoria's Secret & Co. produces free cash flow of $306.21M, offering steady but limited capital for shareholder returns and expansion.
FCF Per Share
Each share generates $3.81 in free cash annually.
FCF Yield
VSCO converts 6.33% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
28.50
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
2.05
vs 25 benchmark
P/B Ratio
Price to book value ratio
7.45
vs 25 benchmark
P/S Ratio
Price to sales ratio
0.75
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
7.25
vs 25 benchmark
Current Ratio
Current assets to current liabilities
1.30
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.26
vs 25 benchmark
ROA
Return on assets percentage
0.03
vs 25 benchmark
ROCE
Return on capital employed
0.09
vs 25 benchmark
How VSCO Stacks Against Its Sector Peers
| Metric | VSCO Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 28.50 | 24.85 | Worse (Expensive) |
| ROE | 26.07% | 1165.00% | Weak |
| Net Margin | 2.67% | 752.00% | Weak |
| Debt/Equity | 7.25 | 0.76 | Weak (High Leverage) |
| Current Ratio | 1.30 | 9.23 | Neutral |
| ROA | 3.32% | 1280.00% | Weak |
VSCO outperforms its industry in 0 out of 6 key metrics, but lagging in P/E Ratio.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Victoria's Secret & Co.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
-2.84%
Industry Style: Cyclical, Growth, Discretionary
DecliningEPS CAGR
121.54%
Industry Style: Cyclical, Growth, Discretionary
High GrowthFCF CAGR
57.99%
Industry Style: Cyclical, Growth, Discretionary
High Growth