On August 27, Bath & Body Works Inc. rose 8.16% in regular trading, trading at $19.02/share, with turnover of $203 million.

The rally was driven by the company's Q2 earnings report released before market open on August 26, which significantly exceeded expectations. Adjusted EPS came in at $0.62, beating the consensus estimate of $0.24 by 158% and representing a 67.57% year-over-year increase. Revenue reached $1.514 billion versus the $1.497 billion estimate, with net sales declining only 2.3% year-over-year.

Simultaneously, the company raised its full-year guidance, lifting adjusted EPS expectations to a range of $2.60 to $2.80 from the prior $2.40 to $2.65, well above the FactSet consensus of $2.65. Full-year net sales decline was narrowed to 4% to 2.5%, and the company projected $650 million in free cash flow. The blowout results sharply contrasted with UBS's pre-earnings expectation of merely in-line EPS and reversed the cautious sentiment that had weighed on shares following Goldman Sachs' July downgrade to sell.

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