Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

Limited Brands, Inc. (LTD): The Secret That Everyone Knows About

La Senza

La Senza is like the Victoria’s Secret of Canada. They have over 300 stores in Canada and another 300 in 30 other countries. La Senza says their focus is on providing customers with the highest quality lingerie. They also offer bras, panties, sleepwear and other products just like Victoria’s Secret. Their products are high in quality while still being offered at affordable prices.

Henri Bendel

Henri Bendel is a luxury retailer of handbags, jewelry, shoes, fragrance, and accessories. Their handbags cost about $250 to $300 and some are upwards of $400. Up until 2008, Henri Bendel was only found in New York City. They now have 28 stores in the most premier shopping destinations in the world. They have not expanded much since being founded in 1895, so chances are the number of stores will never exceed 50.

Competition

Hanesbrands Inc. (NYSE:HBI) and The Gap Inc. (NYSE:GPS) are two of Limited’s top competitors. Hanes Brands designs and manufactures apparel. They make bras, panties, tees, mens underwear, kids underwear, casual wear, socks, and several other types. Hanes owns brands like Champions, Playtex, Wonderbra, and, of course, Hanes. You will find their brands all over the world and in just about every large retail store. They also operate 216 of their own outlet stores across the globe.

The Gap is a specialty retailer located in over 90 countries. They sell products such as denim, khakis, tees, sleepwear, intimate apparel, handbags, jewelry, and accessories. Their brands include Gap, Old Navy, Banana Republic, and Athleta. The Gap operates over 3,000 stores and have a little over 300 franchised stores. The Gap also operates a very successful website, which has proven to be very effective in gaining share in the online marketplace.

Hanes Brands and The Gap each share one flaw; they are not seen as the “sexy” brand. Victoria’s Secret bras and panties are much more desired in the United States than Hanes or Gap’s products. This is the same situation in Canada, with La Senza being the more desired brand. Women will pay up to fulfill their needs and feel good while doing it. The two items women definitely will not skimp on are underwear and bras. These are the two main items hugging your body that cause the most comfort or discomfort. A comfortable woman is a happy woman.

It is for this main reason that I do not see Hanes or The Gap as a threat to Limited Brands, Inc. (NYSE:LTD) in the marketplace. They will all share a space in clothing, but Victoria’s Secret and La Senza will always be the most desired by women. Hanes and The Gap are very strong with male consumers and will continue to be. Luckily, men are not the focus of Limited Brands.

Financial Highlights

Limited Brands announced that net sales for January 2013 surged an impressive 27.4% to $986.4 million compared to January of 2012. Comparable store sales increased 15% at La Senza, 10% at Bath and Body Works, and 8% at Victoria’s Secret. In the fourth quarter, comparable store sales increased 7% at Bath and Body Works, 3% at Victoria’s Secret, and were flat at La Senza. It is important to note that Henri Bendel’s financials are included in Limited Brands’ total results. These are numbers investors like to see.

*Limited Brands reports 4th quarter and full year earnings on Feb. 27, 2013*

DOWNLOAD FREE REPORT: Warren Buffett's Best Stock Picks

Let Warren Buffett, George Soros, Steve Cohen, and Daniel Loeb WORK FOR YOU.

If you want to beat the low cost index funds by 19 percentage points per year, look no further than our monthly newsletter.In this free report you can find an in-depth analysis of the performance of Warren Buffett's entire historical stock picks. We uncovered Warren Buffett's Best Stock Picks and a way to for Buffett to improve his returns by more than 4 percentage points per year.

Bonus Biotech Stock Pick: You can also find a detailed bonus biotech stock pick that we expect to return more than 50% within 12 months.
Subscribe me to Insider Monkey's Free Daily Newsletter
This is a FREE report from Insider Monkey. Credit Card is NOT required.