VSCO
Victoria's Secret & Co.
$84.48
Stable Earnings Power
40%
P/Adj-EPS × Normalized Multiple
Strong
·
Conviction
Overvalued
Trading 122.7% above fair value
You pay
$84.48
Bear
$30.34
Fair
$37.94
Bull
$45.52
Bear
$30.34
-64.1%
$2.21 × 12x P/E
Fair
$37.94
-55.1%
$2.21 × 15x P/E
Bull
$45.52
-46.1%
$2.21 × 18x P/E
Key Value Driver
Normalized P/E multiple (15x base case)
Implied Market Multiple
38.2x
Summary
Our base-case estimate uses a valuation based on adjusted earnings per share and a normalized price-to-earnings multiple. We then blend that result with the average analyst price target of $57.00 from 14 analysts, using a 20% weight on analyst consensus. That produces an estimated intrinsic value of $37.94 per share.
Warnings
Wall Street's average price target is $57.00 (from 14 analysts). Our estimate is 42% below the consensus -- consider that gap carefully.
Key Risks
- Growth DCF inappropriate — terminal value assumptions dominate
- EV/EBITDA misleading for regulated businesses where capex is mandated
- Regulatory risk is a fat tail not visible in normal multiples