Victoria's Secret parent L Brands on Thursday reported the lingerie brand's comparable sales declined in January.
Victoria's Secret's is selling items at a deep discount, but consumers are not responding, according to Jefferies.
L - Brands - Dividend - Quarter
L Brands also announced that its first-quarter dividend would be half last quarter's.
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Victoria - Secret - Brand - Jefferies
The Victoria's Secret brand is broken, Jefferies says.
The lingerie brand's parent company, L Brands, on Thursday reported that Victoria's Secret's total comparable sales (including stores and direct) declined 1% in January, driven by an 8% drop in store-only comps. That was below the Wall Street consensus of 1% increase, according to UBS.
Thursday - Report - Brands - Jefferies - Analyst
Thursday's report shows "the brands are not wanted anymore," said Jefferies analyst Randal Konik, a long-term bear on Victoria's Secret and L Brands.
"Keep in mind that comps remain negative despite very high promos, which means true brand demand is even worse than reported as some consumers buy things when they are given away for free or marked down by more than 50-75%."
Retailer - Promotions - January - Buy - Discount
The retailer's heavy promotions in January included a "buy 2, get 1 free" discount code for bras and sleep, $20 gift cards for future purchases after $40+ in spending (versus $15 rewards card with $75+ spend last January), and a free overnight tote with...
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