L Brands Stock Eyes Best Day in Months Amid CEO Resignation Rumors

There are talks that the firm's CEO of nearly 60 years may be stepping down

Digital Content Manager
Jan 29, 2020 at 9:24 AM
facebook X logo linkedin

The shares of L Brands Inc (NYSE:LB) are eyeing their biggest one-day percentage in nearly 10 months, up 12.1% and trading at $23.05, after the Wall Street Journal reported that CEO Leslie Wexner is not only exploring a full or partial sale of the company's struggling lingerie unit Victoria's Secret, but is also in discussions regarding his resignation. Wexner has been CEO of L Brands since 1963 and recently came under fire for his associations with Jeffrey Epstein, who was arrested last year on trafficking charges. 

L Brands is trading back near its mid-August levels in response, and is now well above its 200-day day moving average, which has served as pressure on the charts since a post-earnings bear gap all the way back in March 2018. While the stock has yet to eclipse its early July peak near the $27 level, for the year it has already added over 20%. 

With disappointing holiday sales figures just in the rear view, its no wonder short sellers have been swarming. In fact, during the past 10 days, short interest has shot up 26.2% to 18.04 million shares sold short, which represents a healthy 7.9% of the stock's available float.

On the other hand, bullish sentiment in the options pits still pervades, per LB's 50-day call/put volume ratio of 5.47 at the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), which sits in the top percentile of its annual range. Given the amount of short interest tied up in the stock, it's possible some of this call buying could be shorts seeking an options hedge against any unexpected upside.

There's pessimism among the brokerage bunch. Thirteen of the analysts in coverage consider L Brands a "hold" or worse, while only six say "strong buy." Meanwhile, the consensus 12-month price target of $21.02 is just a hair higher than last night's close. 


Target Effortless Triple-Digit Gains Every Sunday Evening For Life!

This is your chance to triple your profit potential on Sunday evenings, without spending all your free time watching the market.

On Sundays, as a Weekend Plus subscriber, you’ll get up to 6 trades every Sunday, each targeting gains of 200% or more.

Start targeting gains like the ones our subscribers have seen recently, including:

213.3% GAIN on AutoNation calls
100.0% GAIN on Monster Beverage calls
100.4% GAIN on Walgreens Boots Alliance puts
100.4% GAIN on ON Semiconductor calls
257.7% GAIN on Dell calls

101.0% GAIN on Apollo Global Management calls
103.6% GAIN on JP Morgan  Chase calls
105.3% GAIN on DraftKings calls
101.3% GAIN on Airbnb calls
203.0% GAIN on Shopify calls
102.0% GAIN on Cboe Global Markets calls
100.9% GAIN on Boeing calls
102.1% GAIN on Microsoft puts
102.3% GAIN on First Solar calls
101.5% GAIN on PulteGroup calls
101.0% GAIN on Apple calls
209.4% GAIN on NXP Semiconductors calls
100.8% GAIN on Uber Technologies calls
100.4% GAIN on Academy Sports and Outdoors puts
102.2% GAIN on Trade Desk calls
100.8% GAIN on DoorDash calls
100.0% GAIN on Camping World Holdings puts
100.0% GAIN on Cboe Global Markets calls
100.2% GAIN on C3.ai calls
238.5% GAIN on Oracle calls



Rainmaker Ads CGI