12:52 PM EST, 11/11/2025 (MT Newswires) -- Bath & Body Works ( BBWI ) is expected to post in-line fiscal third-quarter earnings, while sales momentum during the quarter was "lackluster," UBS Securities said in note e-mailed Tuesday.

The brokerage expects the body care products and home fragrances retailer's third-quarter adjusted earnings to match Wall Street's views of $0.40 a share when it reports results Nov. 20. That result would mark a drop from $0.49 reported a year earlier, UBS said in a note to clients. The brokerage expects net sales of about $1.63 billion versus the Street's views for $1.64 billion.

The company likely had "lackluster" sales momentum in the third quarter, based on UBS' channel checks, analysts Jay Sole and Mauricio Serna said.

"Industry sales data indicates (Bath & Body Works' ( BBWI ) third-quarter) US store sales growth should be around (a low-single-digit percentage year over year)," the analysts wrote. "This implies (the company) is trending towards missing the Street's 3% (third-quarter) store sales growth view."

The retailer's shares were down 1.7% in Tuesday afternoon trade. The stock has fallen 43% so far this year.

The company likely saw a low-single-digit percentage growth in August, a high-single-digit drop in September, and high-single-digit increase last month, according to the note.

UBS' third-quarter sales outlook for Bath & Body Works ( BBWI ) implies a 1% year-over-year gain, which it attributed to "benefits given ongoing innovation within (the company's) core and adjacent categories," as well as its collaboration with Walt Disney ( DIS ) .

The brokerage expects Bath & Body Works ( BBWI ) to lower its full-year EPS guidance to between $3.30 and $3.50 from a range of $3.35 to $3.60, while the Street is looking for $3.44.

"We believe investors expect a similar guidance outcome," Sole and Serna wrote. "Plus, our conversations with investors suggest the market is focused on the trajectory of (Bath & Body Works' ( BBWI )) EBIT margin going forward given (the company) plans to expand its distribution into the US wholesale channel."

UBS has a neutral rating and price target of $32 on the Bath & Body Works ( BBWI ) stock.

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