• Jefferies recently restarted coverage of Bath & Body Works with a Hold rating, underscoring the retailer’s upcoming product launches and plans for global expansion.
• The broker’s focus on the company’s untapped international footprint and fresh fragrance pipeline highlights how management is looking beyond the current U.S. store base for growth opportunities.
• Against this backdrop, we’ll examine how Jefferies’ renewed coverage and emphasis on international expansion reshape Bath & Body Works’ investment narrative.

Find companies with promising cash flow potential yet trading below their fair value.

What Is Bath & Body Works' Investment Narrative?

To own Bath & Body Works today, you have to believe the brand can convert its loyal U.S. following into sustainable cash generation while carefully fixing recent missteps. The big near term catalysts still sit in product and merchandising: the Valentine’s collection and a deeper fragrance pipeline, plus any early signs that the new “back to core categories” strategy is stabilizing sales after the disappointing 2025 quarters and guidance cuts. Jefferies’ restarted coverage with a Hold and a higher target effectively acknowledges that, in spite of slower growth expectations and a mixed track record, there is still optionality around global expansion and product innovation. The new class action lawsuit, however, adds another layer of risk on top of existing concerns about high leverage, negative equity and execution on the strategic reset.

However, one risk around recent earnings disclosures may surprise some shareholders. Despite retreating, Bath & Body Works' shares might still be trading above their fair value and there could be some more downside. Discover how much.

Exploring Other Perspectives

Ten fair value views from the Simply Wall St Community span roughly US$17 to over US$60 per share, showing just how far apart individual expectations are. Set that against the recent lawsuit and guidance cuts, and it becomes clear you need to weigh both enthusiastic and cautious readings of Bath & Body Works’ recovery potential.

Explore 10 other fair value estimates on Bath & Body Works - why the stock might be worth 23% less than the current price!

Build Your Own Bath & Body Works Narrative

Disagree with this assessment? Create your own narrative in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Bath & Body Works research is our analysis highlighting 2 key rewards and 3 important warning signs that could impact your investment decision.
• Our free Bath & Body Works research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Bath & Body Works' overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.