Company Announcement - Bath & Body Works, Inc. will have CEO Daniel Heaf and CFO Eva Boratto participate in a fireside chat at the Morgan Stanley Global Consumer & Retail conference on December 3, 2025, at 8:00 a.m. ET [1] - A live audio webcast of the event will be available on the company's website and will be archived for 90 days post-event [2] Company Overview - Bath & Body Works is a global leader in personal care and home fragrance, offering popular products such as fine fragrance mist, body lotion, body cream, 3-wick candles, home fragrance diffusers, and liquid hand soap [3] - The company operates 1,934 company-operated locations in the U.S. and Canada, along with 544 international franchised locations, and has an online storefront at bathandbodyworks.com as of November 1, 2025 [3]

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Core Insights - Artificial intelligence (AI) is identified as the greatest investment opportunity of the current era, with a strong emphasis on the urgent need for energy to support its growth [1][2][3] - A specific company is highlighted as a key player in the AI energy sector, owning critical energy infrastructure assets that are essential for meeting the increasing energy demands of AI technologies [3][7] Investment Landscape - Wall Street is investing hundreds of billions into AI, but there is a looming question regarding the energy supply needed to sustain this growth [2] - AI data centers consume energy equivalent to that of small cities, leading to concerns about power grid strain and rising electricity prices [2] Company Profile - The company in focus is not a chipmaker or cloud platform but is positioned as a crucial player in the energy sector, particularly in nuclear energy infrastructure [7] - It is capable of executing large-scale engineering, procurement, and construction (EPC) projects across various energy sectors, including oil, gas, and renewables [7] Financial Position - The company is noted for being completely debt-free and holding a significant cash reserve, amounting to nearly one-third of its market capitalization [8] - It trades at less than 7 times earnings, indicating a potentially undervalued position in the market [10] Market Trends - The company is poised to benefit from the onshoring trend driven by tariffs, as well as the surge in U.S. LNG exports under the current administration [5][14] - There is a growing recognition on Wall Street of this company's potential, as it quietly capitalizes on multiple favorable market trends without the high valuations seen in other sectors [8][6] Future Outlook - The demand for AI is expected to continue growing, with a significant influx of talent and innovation in the field, making investments in AI infrastructure increasingly attractive [12][13] - The company is positioned to profit from the anticipated energy spike driven by AI, making it a compelling investment opportunity for those looking to capitalize on the digital age [3][11]

Core Insights - The resilience of American consumers during this year's Black Friday exceeded market expectations, leading to a robust growth in retail sales, but this growth masks the reality of limited purchasing power and increasing economic disparity under high inflation [1][2] - The spending behavior of affluent and low-income groups has shown a significant "K-shaped" divergence, with inflation anxiety and price sensitivity becoming core variables driving market sentiment [1][2] Retail Sales Performance - According to SpendingPulse, retail sales in the U.S. (excluding automobiles) increased by 4.1% year-on-year during Black Friday, surpassing last year's growth of 3.4% [1] - Adobe Analytics reported that online shoppers spent $11.8 billion, reflecting a 9.1% increase year-on-year, while Mastercard data indicated a 10.4% growth in online sales, significantly outpacing the 1.7% increase in physical store sales [3] Impact of AI on E-commerce - This year marked the first significant involvement of generative AI in consumer shopping decisions, with AI-related traffic to U.S. e-commerce sites surging by 600% compared to last year [2][3] - Approximately 48% of surveyed consumers indicated plans to use AI to assist in online shopping during the holiday season [3] Economic Disparity - The U.S. economy is exhibiting a clear "K-shaped" trend, with low and middle-income consumers reducing spending while high-income individuals continue to spend lavishly on luxury goods and travel [4] - Experts suggest that the nominal spending growth of 4.1% may translate to a real growth of only around 1% when accounting for the current inflation rate of approximately 3% [4] Consumer Behavior and Price Sensitivity - Price remains a decisive factor influencing consumer choices, with 85% of consumers anticipating further price increases due to potential tariffs under President Trump's policies [6] - Retailers that emphasize value for money, such as Walmart and TJ Maxx, have reported strong sales performance, while others like Target face challenges with lower foot traffic [6] Credit Pressure and Future Outlook - The usage of "Buy Now, Pay Later" payment options has significantly increased, with projected transaction volumes reaching $20.2 billion from November 1 to December 31, indicating cash flow pressures among some consumers [7] - Despite cost-of-living pressures, consumers still demonstrate spending capacity, with expectations for Cyber Monday sales to reach $14.2 billion, a 6.3% increase year-on-year [7]

Core Insights - The consumer discretionary sector has several oversold stocks, presenting potential buying opportunities for undervalued companies [1][2] Company Summaries - **Bath & Body Works Inc (NYSE:BBWI)**: Reported worse-than-expected Q3 results and lowered FY25 EPS guidance. Stock fell approximately 35% in the past month, with a 52-week low of $14.28. RSI value is 29.3, and shares rose 8.6% to close at $16.90 [8] - **Lotus Technology Inc – ADR (NASDAQ:LOT)**: Posted a Q3 loss of 10 cents per share, an improvement from a loss of 30 cents per share a year ago. Stock fell around 31% in the past month, with a 52-week low of $1.06. RSI value is 29.5, and shares rose 3.2% to close at $1.29 [8] - **H & R Block Inc (NYSE:HRB)**: Reported better-than-expected Q1 results, indicating a strong start for fiscal 2026. Stock fell about 20% in the past month, with a 52-week low of $41.38. RSI value is 26.9, and shares rose 1.3% to close at $41.94 [8]

Core Insights - The consumer discretionary sector has several oversold stocks, presenting potential buying opportunities for undervalued companies [1] Group 1: Bath & Body Works Inc (BBWI) - Bath & Body Works reported worse-than-expected third-quarter financial results and lowered FY25 EPS guidance, citing current business trends and macro consumer pressures [8] - The company's stock fell approximately 35% over the past month, reaching a 52-week low of $14.28 [8] - The RSI value for Bath & Body Works is 29.3, with shares rising 8.6% to close at $16.90 [8] Group 2: Lotus Technology Inc (LOT) - Lotus Technology posted a third-quarter loss of 10 cents per share, an improvement from a loss of 30 cents per share a year ago [8] - The stock has decreased around 31% over the past month, with a 52-week low of $1.06 [8] - The RSI value for Lotus Technology is 29.5, and shares increased by 3.2% to close at $1.29 [8] Group 3: H & R Block Inc (HRB) - H&R Block reported better-than-expected first-quarter financial results, indicating a strong start to fiscal 2026 [8] - The stock has fallen about 20% over the past month, with a 52-week low of $41.38 [8] - The RSI value for H&R Block is 26.9, and shares rose 1.3% to close at $41.94 [8]

Core Viewpoint - The company aims to market fewer products to position itself for long-term growth [1] Group 1 - The seller specializes in candles, scents, and soaps [1] - The strategic shift is focused on long-term growth rather than short-term sales [1]

Core Viewpoint - Bath & Body Works (NYSE:BBWI) is experiencing significant pressure, with recent earnings showing a decline in EPS from $0.49 to $0.37, and management forecasting a single-digit decline in net sales due to weaker consumer demand [1] Group 1: Earnings and Sales Performance - The company's EPS decreased to $0.37 from $0.49, indicating a decline in profitability [1] - Management anticipates a single-digit decline in net sales, attributing this to softer consumer demand [1] Group 2: Adhishthana Cycle Analysis - BBWI is currently in Phase 18 of its Adhishthana cycle, which is characterized by sluggishness and consolidation, with no sustainable bullish structure observed in previous phases [2][4] - The stock's transition into Phase 18 occurred in April 2025, and this phase will remain in effect until September 2026, suggesting that the current movement characteristics are likely to persist [5] Group 3: Guna Triads and Market Behavior - The Guna Triads indicate that for a Nirvana move to occur in Phase 18, a clean and sustainable bullish structure (Satoguna) is necessary, which is currently absent [7] - Due to the weak triad structure and lack of Satoguna, BBWI is expected to remain constrained in Phase 18, with any potential rallies being short-lived and unlikely to develop into meaningful trends [8] Group 4: Investment Strategy Implications - For long-term investors, the current cycle does not support value-driven positioning, indicating that this is not an accumulation zone [9] - Traders may consider a range-bound approach, utilizing credit spreads skewed to the downside to capitalize on the Phase 18 movement [9]

Core Insights - American consumers have shown a significant rebound in mall foot traffic in October 2025, indicating a potential resurgence in consumer enthusiasm ahead of the holiday season [1][2] Mall Performance - All mall formats experienced year-over-year visit gains in October 2025, with indoor malls leading the growth, while open-air shopping centers and outlet malls also returned to positive traffic after four months of decline [2] - Month-over-month data revealed a sharp increase in visits: 6.1% for indoor malls, 5.5% for open-air shopping centers, and 7.9% for outlet malls compared to September 2025 [3] Consumer Behavior - The increase in foot traffic suggests that consumers may be starting their holiday shopping early or are actively seeking deals [3] - However, increased foot traffic does not necessarily correlate with increased spending, as evidenced by Bath & Body Works' strategy of closing mall locations while maintaining cash flow positivity across its store fleet [4] Bath & Body Works Strategy - Bath & Body Works has been actively shifting its store locations away from malls since late 2022, with a goal of achieving a store distribution of approximately two-thirds in malls and one-third in off-mall locations [5][6] - The company reports that 99% of its stores are cash flow positive, indicating no financial challenges within its real estate portfolio [5]

Other writing on Substack: https://yieldstrategies.substack.com/I am currently focused on income investing through either common shares, preferred shares, or bonds. I will occasionally break away and write about the economy at large or a special situation involving a company I've been researching in. I target two articles per week for publication on Monday and Tuesday.About My Background: Bachelors in history/political science, Masters in Business Administration with a specialization in Finance and Economic ...