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Bath & Body Works Faces Massive Price Target Cuts Amid Earnings Miss

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Written by Timothy Sykes Reviewed by Jack Kellogg Fact-checked by Ellis Hobbs
Updated 11/21/2025, 4:50 pm ET 11/21/2025, 4:50 pm ET | 6 min 6 min read
Bath & Body Works Faces Massive Price Target Cuts Amid Earnings Miss Thumbnail

Bath & Body Works Inc.’s stocks have been trading down by -4.55 percent amid market concerns about retail challenges.

Consumer Discretionary industry expert:

Analyst sentiment – negative

Bath & Body Works (BBWI) appears to be navigating significant challenges within its market segment. The company exhibits a robust gross margin of 44.6% and an EBIT margin of 18.6%, which are commendable in the retail sector, though the efficiency in translating this to profit is limited by its net profit margins at 9.88%. The revenue trajectory over five years shows a concerning decline of 8.28%, highlighting potential issues in sales growth and market traction. BBWI’s valuation ratios, with a P/E ratio of 6.19 and a price-to-sales ratio of 0.59, reflect a market skepticism about its growth prospects or underlying financial health, emphasized by a negative price-to-book ratio of -2.8, signaling potential balance sheet vulnerabilities.

Technically, BBWI has experienced a substantial sell-off aligned with a key support level breached recently. After opening at 21.45 earlier this week and closing notably weaker at 14.85, the stock is entrenched in a downtrend, with sharp sell-offs signaling weakening support. This is underscored by a pronounced price drop to 15.82 recorded recently. With the dominant trend being bearish, an actionable trading strategy would be short-focused, looking for entry opportunities on minor rebounds towards resistance at around $17, with a stop set just above recent highs at $21. Volume surges indicating selling pressure further support a bearish outlook in the near to mid-term.

Recent market news catalyzes a challenging outlook for BBWI, with multiple analyst downgrades from firms such as Baird, Goldman Sachs, and JPMorgan, all citing disappointing Q3 earnings and downward revisions in earnings guidance as core concerns. The missed collaborations and competitive pressures further compound the outlook, suggesting a turbulent holiday season ahead, reflected by the drastic guidance reductions for fiscal 2025. Compared to benchmark indices, BBWI’s stock has underperformed within the Consumer Discretionary and Retail sectors, exacerbated by weak execution in strategic initiatives. Persistent market pressures and a bearish technical setup suggest a negative sentiment, with potential downside to $15 as ongoing support or pivotal levels for reversal warrant close monitoring.

  • The company’s recent collaboration with Disney Villains fell short of consumer expectations, contributing to a muted outlook for the holiday season.

  • Q4 earnings per share guidance is set below analyst predictions, indicating a challenging retail landscape for the company.

  • A notable market response has seen the share price plummet by nearly 25%, as investor confidence wavers amidst the retailer’s revised fiscal outlook.

  • Bath & Body Works announced a strategy to focus on substantial cost reductions across the board, aiming for $250 million in savings over the next two years.

Candlestick Chart

Weekly Update Nov 17 – Nov 21, 2025: On Friday, November 21, 2025 Bath & Body Works Inc. stock [NYSE: BBWI] is trending down by -4.55%! Discover the key drivers behind this movement as well as our expert analysis in the detailed breakdown below.

Quick Financial Overview

Bath & Body Works has recently released their third-quarter results, which highlight some troubling financial metrics. The company declared a drop in earnings per share to $0.35, missing estimates of $0.39. Simultaneously, net sales also decreased to $1.59 billion, falling short of the predicted $1.63 billion. This undoubtedly casts a shadow on their fiscal health as they adjust their full-year earnings expectation to “at least” $2.87 per share, a number still trailing behind analysts’ forecasts of $3.41.

Looking at their valuation, the price-to-earnings (P/E) ratio stands at 6.19, signifying caution among investors anticipating future earnings capability amidst their earnings miss. Notably, the gross margin remains at a commendable 44.6%, yet it’s not enough to offset concerns within their current profitability and performance metrics. The company’s net income also undershot expectations, capturing only a $64 million return this quarter.

More Breaking News

The news of diminishing revenues spells trouble in a competitive retail landscape, causing a reverse in Bath & Body Works’ market momentum. More concerning is the anticipated tough road ahead, with analysts noting significant impacts on their Q4 projections, which are projected below market sentiment—underscored by EPS forecasts considerably lower than previously held expectations, painting a cautiously pessimistic picture for the next fiscal quarter.

Conclusion

In conclusion, the current landscape for Bath & Body Works is unquestionably challenging, marked by weakened earnings and formidable market skepticism. The strategic recalibration announced, focused on considerable cost-saving measures, sets the stage for potential recovery. However, addressing underlying retail operational concerns and re-engaging consumer interest remain pivotal hurdles. As millionaire penny stock trader and teacher Tim Sykes says, “Consistency is key in trading; don’t let emotions dictate your trades.” This principle resonates in the approach Bath & Body Works must take; being disciplined and steady in executing their strategies is vital, particularly during such volatile times. Without a decisive, impactful market thrust this holiday season, the outlined strategies may take significant time to materially affect the equity narrative and trading sentiment. Overall, cautious optimism may prevail should Bath & Body Works adeptly navigate its current fiscal discipline framework while tactically revitalizing its brand allure in an intensely competitive retail environment.

This is stock news, not investment advice. Timothy Sykes News delivers real-time stock market news focused on key catalysts driving short-term price movements. Our content is tailored for active traders and investors seeking to capitalize on rapid price fluctuations, particularly in volatile sectors like penny stocks. Readers come to us for detailed coverage on earnings reports, mergers, FDA approvals, new contracts, and unusual trading volumes that can trigger significant short-term price action. Some users utilize our news to explain sudden stock movements, while others rely on it for diligent research into potential investment opportunities.

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Tim Sykes

Head Writer at TimothySykes.com, Lead Mentor at the Trading Challenge
In his 20-plus years of trading, Tim has made $7.9 million. In his 15-plus years of teaching, Tim’s Trading Challenge has produced over 30 millionaire students. His philosophy emphasizes small gains and cutting losses quickly.
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* Results are not typical and will vary from person to person. Making money trading stocks takes time, dedication, and hard work. There are inherent risks involved with investing in the stock market, including the loss of your investment. Past performance in the market is not indicative of future results. Any investment is at your own risk. See Terms of Service here

The available research on day trading suggests that most active traders lose money. Fees and overtrading are major contributors to these losses.

A 2000 study called “Trading is Hazardous to Your Wealth: The Common Stock Investment Performance of Individual Investors” evaluated 66,465 U.S. households that held stocks from 1991 to 1996. The households that traded most averaged an 11.4% annual return during a period where the overall market gained 17.9%. These lower returns were attributed to overconfidence.

A 2014 paper (revised 2019) titled “Learning Fast or Slow?” analyzed the complete transaction history of the Taiwan Stock Exchange between 1992 and 2006. It looked at the ongoing performance of day traders in this sample, and found that 97% of day traders can expect to lose money from trading, and more than 90% of all day trading volume can be traced to investors who predictably lose money. Additionally, it tied the behavior of gamblers and drivers who get more speeding tickets to overtrading, and cited studies showing that legalized gambling has an inverse effect on trading volume.

A 2019 research study (revised 2020) called “Day Trading for a Living?” observed 19,646 Brazilian futures contract traders who started day trading from 2013 to 2015, and recorded two years of their trading activity. The study authors found that 97% of traders with more than 300 days actively trading lost money, and only 1.1% earned more than the Brazilian minimum wage ($16 USD per day). They hypothesized that the greater returns shown in previous studies did not differentiate between frequent day traders and those who traded rarely, and that more frequent trading activity decreases the chance of profitability.

These studies show the wide variance of the available data on day trading profitability. One thing that seems clear from the research is that most day traders lose money .

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Citations for Disclaimer

Barber, Brad M. and Odean, Terrance, Trading is Hazardous to Your Wealth: The Common Stock Investment Performance of Individual Investors. Available at SSRN: “Day Trading for a Living?”

Barber, Brad M. and Lee, Yi-Tsung and Liu, Yu-Jane and Odean, Terrance and Zhang, Ke, Learning Fast or Slow? (May 28, 2019). Forthcoming: Review of Asset Pricing Studies, Available at SSRN: “https://ssrn.com/abstract=2535636”

Chague, Fernando and De-Losso, Rodrigo and Giovannetti, Bruno, Day Trading for a Living? (June 11, 2020). Available at SSRN: “https://ssrn.com/abstract=3423101”