Personal care and home fragrance retailer Bath & Body Works (NYSE:BBWI) will be announcing earnings results tomorrow before market open. Here’s what you need to know.

Bath and Body Works beat analysts’ revenue expectations by 2.1% last quarter, reporting revenues of $1.61 billion, up 3.1% year on year. It was a strong quarter for the company, with EPS guidance for next quarter topping analysts’ expectations and a decent beat of analysts’ EBITDA estimates.

Is Bath and Body Works a buy or sell going into earnings? Read our full analysis here, it’s free.

This quarter, analysts are expecting Bath and Body Works’s revenue to decline 4.7% year on year to $2.78 billion, a deceleration from its flat revenue in the same quarter last year. Adjusted earnings are expected to come in at $2.04 per share.

Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. Bath and Body Works has missed Wall Street’s revenue estimates twice over the last two years.

Looking at Bath and Body Works’s peers in the specialty retail segment, only Sally Beauty has reported results so far. It met analysts’ revenue estimates and delivered flat year-on-year revenue. The stock traded up 2.1% on the results.

Read our full analysis of Sally Beauty’s earnings results here.

Valuation multiples for many growth stocks have not yet reverted to their early 2021 highs, but the market has been optimistic as of late due to a soft landing. This is an economic situation where rate hikes successfully quelled inflation but did not send the economy into a recession. Furthermore, recent rate cuts and Donald Trump's triumph in the 2024 Presidential election have been tailwinds for the market, and while some of the specialty retail stocks have shown solid performance, the group has generally underperformed, with share prices down 7.8% on average over the last month. Bath and Body Works is up 6.3% during the same time and is heading into earnings with an average analyst price target of $46.86 (compared to the current share price of $40.63).

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