Goldman Sees Bath & Body Works Valuation As Highly Attractive, Remains Bullish

Goldman Sachs analyst Kate McShane on Tuesday reiterated a Buy rating on the shares of Bath & Body Works Inc (NYSE:BBWI) with a price forecast of $49.00.

BBWI is leveraging collaborations, like its Disney Princess collection, to boost customer traffic during off-peak periods, with app downloads and search interest rising.

The Disney collection outperformed others in search interest, with peak searches observed shortly after its launch, highlighting its strong market impact.

BBWI saw a 42% year-over-year increase in app downloads during the Disney Princess collaboration from 2/10/25 to 2/17/25.

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In February 2025, BBWI’s app downloads totaled 349,000, outperforming Sephora but lagging behind Target and Ulta Beauty.

Despite a slight 2% drop in downloads from February 2024, BBWI’s app performance has improved significantly since launching its loyalty program, with downloads up 52% from July 2022 and 214% from February 2019.

A study on BBWI’s 3-wick candle pricing and free shipping promotions from mid-May 2022 to mid-March 2025 revealed a slight increase in candle prices for January and February 2025 compared to last year. Meanwhile, March 2025 prices dropped 13.6% year-over-year.

In-store promotions for first-quarter are in line with averages since fourth-quarter 2022, with the company aiming for higher AUR and continued innovation in the market.

The price target of $49 is based on the analyst’s downside/base/upside case relative P/E multiples of 45%/55%/65%. Also, the analyst sees the valuation as highly attractive with the stock trading at 8.9x NTM P/E.

The analyst’s bullish rating reflects that BBWI is well-positioned to offer customers with value by offering affordable luxuries, along with its several growth initiatives.

Price Action: BBWI shares traded lower by 1.74% at $31.64 at last check Wednesday.

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