L Brands Analyst Roundup On Q3 Guidance

L Brands Inc LB raised its Q3 EPS guidance Monday to $0.38 to $0.40 versus prior expectations for $0.26 to $0.31.

The stock reacted by trading at $74.24 as of Tuesday afternoon, up 2.5 percent.

Below are some comments from analysts in response to the revised guidance along with current ratings and price targets.

Bank of America - Neutral, $75 price target

"Comps were up low-single digits, in line with the company’s guidance and our +2.7 percent estimate. Strength at Bath and Body Works drove the result; BBW comps were up 5 percent for the month, while Victoria’s Secret comps were flat and VS Direct was down 7 percent. LB is one of the few retailers hitting earnings expectations and as such, we expect investors to pay a premium to the group multiple for a high quality company that is a category killer in the lingerie market. The stock could rise above our price objective if new product launches drive productivity to new peaks, or gross margins exceed expectations."

Mizuho Securities - Neutral, $76 price target

"While we are impressed by the magnitude of the beat from better-than-expected merchandise margins (lapping declining compares from 2H13) on clean inventory levels (-18 percent psf at Sept month), and compelling international growth prospects, we believe relative outperformance is already partially baked into investor expectations given LB’s premium valuation of ~20x vs. peer group average of ~15x."

Wunderlich Securities - Buy, $82 price target

"We continue to believe L Brands' enhanced execution from frequent innovative product launches to disciplined inventory management is not only driving consumer excitement but is resulting in merchandise margin improvement. Going forward, initiatives remain in place to drive greater omni-channel productivity and increase global square footage -- when combined with industry leading brands, we believe this will prove to be a winning formula."