Limited Brands Inc. (LTD)

Notoriously unable to retain talent in merchandising. The revolving door seems to be spinning faster there over the last six months. In particular, I believe that customers will notice a decline in the quality of goods offered at Bath and Body Works as the company devotes a higher and higher percentage of the sales floor to proprietary brands. These goods may have better margins but are not of consistent quality and will not keep the customers coming back.

Only problem with this retailer is poor topline sales. Top management has commissioned an independent marketing group to go into every business unit, stomp all over the unit's marketing team, and implement a new marketing strategy from the top down. Has already successfully revitalized leading brands and increased top line sales -- which have in turn hit bottom line. Don't see this stopping. Don't see the risk of lower consumer confidence making too big an impact -- at least not in any permanent way.

Victoria Sectret is dominant. No store comes close to controlling and selling underwaer to women. They have an incredibile moat. I addition, I do not think they have to keep the inventory as fresh as other mall retailers. Its is underwear, and women will buy what is comfortable along with the occasional "this makes me sexy" purchase. LTD will need to do something with it in order to unleash its true value and get it away from the other laggard brands. This should happen within the next few months..

I like their sales figures for December, and overall, I liked the selection in their stores. I think this earnings will be a good one. It's also a nice strong company to be have in your portfolio. I think some of my other picks are better than this stock, but I am including it here just because I do believe it will at least outperform the S&P.

I have been investing in this stock for about a year now. It is still getting rave reviews as a solid performer.

Big Victoria's Secret fan (wink).

Limited provides many products to the market but the important part of this company is Victora Secret. It seems that no matter how bad the economy gets and how low the consumer confidence index is, people (women mostly) are still willing to pay top dollar for intimates, its a strange trend but a solid one at least so far. That is why I expect LTD to outperform the market for at least the next year.

Putting a red thumb down on specialty retail apparel is like planting for a spring/summer harvest, not everything will come up but most will.

I have owned this in the past and did OK, but now it has a low P/E and a Yield!

I think their plans to expand Victoria Secret Brand will be a success.

SmartMoney pick

A great company to hold until at least after Xmas

Ltd has been lower, with the markets higher. Retail sales are not going to be great this year, and LTD currently has a high stock price

VICTORICA SECERT

Aug 20, 2008 Q2 2008 Earnings Release - 4:00PM EDT

staying with them

retailer

I love the company as a whole but they will probably have to cut their dividend in the face of a downturn since they are carrying so much debt

Current Price: $22.06
Last Trade Time: 9/3/2008 4:01 PM

Sell Stop @ $18.25
Sell Limit @ $28.75

Victoria Secret...enough said