Limited Brands, Inc. (LTD), Coach, Inc. (COH): Retailers Set Up for Successful Turnarounds

What to look out for
In recent years, I’ve come to consider The Gap Inc. (NYSE:GPS) the apparel brand that most other apparel brands need to look out for. The GapBody brand targets the same demographic that Victoria’s Secret appeals to. As Gap continues to expand its footprint, more GapBody locations are going to spring up within striking distance of Victoria’s Secrets.

The Gap Inc. (NYSE:GPS) has been growing sales at a strong clip and, in June, it pushed its full business year-over-year comparable sales up 7% worldwide. Gap brand comparable sales grew 5% over the same period, which easily beat out the 1% fall that Victoria’s Secret experienced in June.

That potential to rise to The Gap Inc. (NYSE:GPS)’s level is what makes Limited Brands, Inc. (NYSE:LTD) an interesting opportunity. The downside is that it’s no secret. Limited is trading at 23 times its trailing 12-month earnings, while Gap is trading at about 18, and Coach, Inc. (NYSE:COH) is down at 15. Even so, I like the potential, and I think Limited Brands could make a run for it, if it could just sort a few issues out.

The article 3 Retailers Set Up for Successful Turnarounds originally appeared on Fool.com.

Fool contributor Andrew Marder has no position in any stocks mentioned. The Motley Fool recommends Coach. The Motley Fool owns shares of Coach.

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