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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Bath & Body Works, Inc. (XNYS:BBWI) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
BBWI
Name:
BATH & BODY WORKS, INC. (XNYS:BBWI)
Sector:
184.00M
Industry:
Specialty Retail
CEO:
Total Employees:
8,800
Our Technological Advancement Rating
Our Rating:
A+
Technological advancement compared to industry is 6717.64% higher
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF BATH & BODY WORKS, INC.(BBWI) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND SPECIALTY RETAIL INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
38.47
One Month Price Target:
$38.85
Six Month Price Target :
$40.76
Likely Price in One Year's Time:
Ticker:
$43.05
Likely Trading Range Today Under (Normal Volatility)
$38.27
Price Upper limit ($) :
$38.85
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$35.05
This week:
$30.82
This month :
$23.16
Other Primary facts
Market Cap:
8.52B
Market Cap Classification:
Mid Cap
Number of Shares
IPO Date:
228.37M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
39.04%
-27.73%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$54.33
$46.91
$22.61
$30.03
Medium risk (<10%) entry points
Buy Call
Sell Call
$44.49
Buy Put:
Sell Put:
$42.91
$32.43
$34.03
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
BBWI
Sharpe Ratio:
5.27%
Comparison:
BBWI, is amongst the top 20% stocks with highest risk-adjusted returns
Sharpe ratio is 84.33% higher than the industry
& ratio is 131.31% higher than the market/S&P 500 average
Average Returns/Yield of
BBWI
Daily returns:
0.24%
Weekly returns:
1.22%
Monthly returns:
4.87%
Yearly returns:
34.92%
Comparison of returns:
Average annual returns/yield (last 3 years) is 67.36% above industry average
Classification:
BBWI, is amongst the top 20% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.28
Statistical test of Returns:
BBWI has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
4.45%
Weekly Volatility:
9.95%
Monthly Volatility:
19.91%
Yearly Volatility:
68.95%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
1.65%
Volatility in last five trading days has been -62.83% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-8.90%
Weekly VaR:
-19.90%
Monthly VaR:
-39.79%
How Much Can the price of
BBWI
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-32%
Worst case (decline):
>85%
This translates to price declining to:
$26.01
This translates to price declining to:
$5.77
Severe Crash Probability
Risk of crash in next 6/12 months: Very high (>70%)
What is Value at Risk (VaR)?
Risk Fundamentals
BBWI is a 180.85% riskier investment compared to the market/S&P 500 & is 140.60% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is 7.16% above industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
BBWI
Beta in relation to market/S&P 500--1.77
Expected beta in 1 year's time:
1.279
Expected beta in 3 year's time:
1.809
Unlevered (debt free) Beta:
-0.174
Beta in relation to Nasdaq (XNAS):
1.117
Beta in relation to all global stocks::
0.993
Beta Comparison & Analysis
Beta of competitors/peers::
-
-
Average Industry Beta:
1.43
Beta is 23.91% above industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
-
-
Alpha provided | Alpha Analysis
Alpha provided:
0.432
Alpha is 96.37% above industry average alpha yield
Alpha is 2747% higher than market/& is unsustainably high
Analysis of Cost of Capital of
BBWI
Equity cost of capital:
0.153
Equity cost of capital is 18.09% above industry mean WACC
Unlevered (without debt) cost of capital:
-1.50%
Before-tax cost of debt:
4.38%
After-tax cost of debt:
3.46%
Overall debt rating:
Lower BB medium grade (Fifth highest grade)
Weighted average cost of capital (WACC):
3.46%
WACC is -17.88% below industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$41.50
Revenue growth rate per share of (3Y):
-16.48
Annual revenue growth rate is -115.17% below industry average
EPS:
$4.66
Expected Annual growth rate of EPS (3Y):
0.00%
-
Free cash flow (FCF) per share:
$4.09
Balance sheet equity growth per share: -87.68%
Equity growth rate per share is -270.96% lower than the industry
Debt per share
$34.36
EBITDA per share
$9.73
Valuation Analysis Today of
BBWI
P/E Ratio:
9.41
P/E Ratio of Competitors/Peers:
-
- & is -56.25% lower than the industry
Stock price/value with industry average P/E ratio: $100.24
BBWI is -61.62% undervalued if valued using industry average P/E ratio
Share value as per dividend discount (DDM) model: $12.43
Present value of the expected future dividends only: $5.02
P/S (Price to Sales ratio):
0.93
Price to sales ratio is -77.21% below the industry mean
P/B (Price to book value ratio):
-16.48
Price to free cash flow: 9.41
Price to free cash flow ratio is -62.13% lower than the industry
Net income growth rate (3Y):
-12.55%
Net income growth rate is -97.35% lower than the industry average net income growth rate
Dividend Analysis
-
Dividend yeild: 1.82%
Previous Dividend: $0.20
Previous adjusted dividend: $0.20
Previous Dividend: $0.70
Expected next dividend best case: $0.26
Expected next dividend worst case: $0.14
Average dividend payment (long-term): $0.19
Average dividend increase/decrease (growth rate) % per period: 1.17%
Expected next dividend payment date: 15/09/2022
Expected next dividend record date: 09/01/2022
-
Previous dividend payment date: 17/06/2022
Previous dividend record date: 06/03/2022
-
Dividend History:
2022-06-02--$0.20
2021-11-18--$0.15
2021-06-03--$0.15
2022-02-17--$0.20
2021-08-19--$0.15
2020-02-20--$0.30
Dividend growth rate is -623.60% lower than the industry average
In-depth Debt & Leverage Analysis
Debt to equity ratio:
-1469.66%
Net debt to equity ratio:
-1038.39%
Debt to assets ratio:
74.42%
Net debt to assets ratio:
52.58%
Debt-to-asset ratio is 2.85% above industry average
Ability to repay debt:
Interest coverage ratio:
6.07
Interest coverage ratio is -75.50% less than industry average
Looking forward:
Debt growth rate:
4.15%
Annual debt growth is -94% lower than industry average debt growth rate
Debt repayment rate in last quarter: 12.59%
Analysis of Key Statistics
Correlation of price movement with the market:
0.528
Statistical significance of correlation:
BBWI has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.475
Stock price is 11.19% more correlated with the market, compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.475
Correlation of price movement with Nasdaq (^IXIC):
-0.014
Covariance of price movement with the market:
-0.037
Kurtosis
17.155
Returns have severe fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are considerably more likely, compared to assets with normally distributed returns
Skewness of returns:
1.456
Returns are right (positive) skewed; mean returns are greater than median and mode returns
Fundamental Analysis & Dupont Analysis of
BBWI
Gross Profit Margin Ratio:
189%
Operating Profit Margin Ratio:
22.87%
Operating profit margin is 251.72% higher than the industry
Net Profit Margin Ratio:
189%
Effective Tax Rate:
24.00%
Effective tax rate is 6.44% higher than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
-226.78%
Return on equity (ROE) is -16041.84% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
11.48%
Return on assets (ROA) is 23.42% higher than the industry
Financial Leverage:
3.9x
Current Ratio:
1.72
Current ratio is -8.84% below industry average
Cash Conversion Cycle (days):
-15.2
Cash conversion cycle is -123.48% below industry average
The remaining useful life of property plant & equipment is: 12.5 years
Stock based compensation to net income ratio:
1.24%
In-depth Efficiency Analysis
Revenue generated per employee:
1.1M
Each employee generates 46% more revenue than industry average revenue per employee
EBITDA generated per employee:
252.4K
Each employee generates 4% more EBITDA than industry average revenue per employee
Profit generated per employee:
137.6K
Each employee generates -7% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
20.9K
Each employee generates -49% less free cash flow than industry average revenue per employee
Assets/Capital per employee
674.3K
Each employee generates -49% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
BBWI
-
-
-
-
-
-
-
-
-
Current Analyst Ratings
Strong buy�0%
Buy�0%
Hold�0%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: -
Income Statement
Period:
TTM
Date:
4/30/22
Revenue:
9.48B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
5.03B
4.45B
-
2.29B
2.29B
-
-
2.29B
-
366.00M
234.00M
2.22B
2.17B
1.21B
1.71B
410.00M
1.21B
Statement of Cash Flow
Date:
Period:
129.00M
Differed Income Tax :
10.00M
Stock Based Compensation :
15.00M
Change in Working Capital :
- 287000.00K
Accounts Receivables:
49.00M
Other Working Capital:
- 107000.00K
Other Non-Cash Items:
105.00M
Net Cash Provided by Operating Activities:
249.00M
Investments in PP&E:
-
Net Acquisitions:
-
Purchases of Investments:
-
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
4/30/21
2022
Q1
2.81B
-
2.81B
221.00M
1.40B
187.00M
4.61B
4.63B
628.00M
411.00M
-
72.00M
197.00M
5.93B
-
10.55B
735.00M
504.00M
149.00M
-
1.44B
2.68B
7.85B
306.00M
8.40B
-
11.08B
144.00M
- 1144000.00K
86.0M
380.00M
April 30, 2021 at 6:00:00 AM
7.31B
- 534000.00K
10.55B
-
8.35B
5.5B
-
- 56000.00K
- 56000.00K
- 1130000.00K
-
- 155000.00K
-
- 6000.00K
- 1291000.00K
2.00M
- 1096000.00K
2.84B
3.93B
249.00M
- 65000.00K
184.00M
Our Proprietary Portfolio Rating
Our Rating:
A+
Price Forecast/Expected Price in Next 5 Years of
BBWI
2023
2024
2025
2026
2027
$40.56
$45.39
$50.79
$56.84
$63.61