What Happened?

Shares of intimatewear and beauty retailer Victoria’s Secret (NYSE: VSCO) jumped 1.9% in the morning session after Jefferies raised its price target on the stock to $30 from $26, citing strong momentum. 

The investment bank's move reflects growing confidence in the company. This follows a similar price target increase from UBS in late August, which raised its target to $25 after Victoria's Secret reported second-quarter results that surpassed analyst expectations. According to UBS, the company's quarterly report showed its turnaround is gaining traction. 

After the initial pop the shares cooled down to $26.49, up 3.3% from previous close.

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What Is The Market Telling Us

Victoria's Secret’s shares are extremely volatile and have had 39 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.

The previous big move we wrote about was 9 days ago when the stock dropped 3.7% on the news that the major indices continued to retreat amid profit-taking and renewed concerns about tariffs. Investors reacted to a federal court ruling that most of President Trump's global tariffs were illegal, raising uncertainty over trade policy and the fiscal impact of potential refunds. Rising Treasury yields added to the pressure, with the 10-year climbing above 4.2% and the 30-year nearing 5%, intensifying worries about stretched equity valuations. September's historically weak track record for stocks further dampened sentiment, leaving traders cautious ahead of the jobs report later in the week and the Federal Reserve's upcoming rate decision.

Victoria's Secret is down 34.5% since the beginning of the year, and at $26.49 per share, it is trading 45.6% below its 52-week high of $48.71 from December 2024. Investors who bought $1,000 worth of Victoria's Secret’s shares at the IPO in July 2021 would now be looking at an investment worth $623.29.

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