LB - L Brands May Want to Shed Victoria's Secret but It's a Tough Sell
Read the headlines carefully, and you'll see L Brands (NYSE: LB) has neither confirmed nor denied rumors of lingerie retailer Victoria's Secret being put up for sale. Likewise, whispers that CEO Leslie Wexner is stepping down only cite unnamed "people familiar with the matter" as the source of the prospect.
Nevertheless, given the company's ongoing struggle to reverse its declining same-store sales and the fact that the sale prospect has been broached before, there could be some truth to the matter. Investors certainly felt that way on Wednesday after hearing the suggestion, sending shares higher to the tune of 12.9% by the close.
The market may want to tamp down the enthusiasm, however. L Brands could be interested in selling the Victoria's Secret brand and holding on to its (much) more successful Bath & Body Works brand, but that doesn't mean anyone's interested in buying a brand that needs a major overhaul.