Victoria’s Secret & Co. (NYSE:VSCO) shareholders that were waiting for something to happen have been dealt a blow with a 38% share price drop in the last month. Instead of being rewarded, shareholders who have already held through the last twelve months are now sitting on a 43% share price drop.
In spite of the heavy fall in price, Victoria’s Secret’s price-to-earnings (or “P/E”) ratio of 12.8x might still make it look like a buy right now compared to the market in the United States, where around half of the companies have P/E ratios above 17x and even P/E’s above 32x are quite common. Although, it’s not wise to just take the P/E at face value as there may be an explanation why it’s limited.
With earnings that are retreating more than the market’s of late, Victoria’s Secret has been very sluggish. It seems that many are expecting the dismal earnings performance to persist, which has repressed the P/E. If you still…
