Why Victoria's Secret Stock Roared Today

Victoria's Secret (NYSE: VSCO) stock surged 17% through 10:05 a.m. ET Friday morning after beating on earnings.

Analysts forecast the lingerie retailer would lose $0.59 per share on $1.4 billion in sales in its Q3 2025. Victoria's Secret actually lost only $0.27 (adjusted for one-time items), and sales approached $1.5 billion.

Victoria's Secret Q3 earnings

Victoria's Secret grew its sales 9% year over year in Q3, with the Victoria's Secret, PINK, and Beauty brands all contributing to growth. Same-store sales alone grew a strong 8%. CEO Hillary Super called the results "outstanding" -- enough so that she raised guidance for the rest of the year.

Victoria's Secret still lost money in the quarter. "Adjusted" earnings aside, Victoria's Secret reported a net loss of $0.46 per share in the quarter. That was better than expected, and better than the $0.71 Victoria's Secret lost one year ago.

But it was still a loss.

Is Victoria's Secret stock a buy?

Turning to guidance, full-year sales are now trending above $6.45 billion, and management says its adjusted earnings this year are also looking better than expected. Not counting the cost of tariffs, Victoria's Secret thinks it could earn anywhere from $2.40 to $2.65 per share this year.

Subtract $90 million in tariff costs, and divide by Victoria's Secret's 80 million shares outstanding, and this leaves the company with at least $1.28 per share in profit this year. On a $49 stock, that works out to a price-to-earnings ratio of about 38.

That's expensive, but even without the tariffs, Victoria's Secret stock would cost 20 times earnings, and be growing at only 9%. Either way you look at it, I fear, Victoria's Secret stock is still too expensive to buy.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.