What Happened?
Shares of personal care and home fragrance retailer Bath & Body Works (NYSE: BBWI) fell 5.7% in the afternoon session after a weak U.S. jobs report and signs of a broader retail sector pullback. The latest U.S. nonfarm payrolls data showed a disappointing gain of only 22,000 jobs, far below the market estimate of 75,000, while the unemployment rate ticked up to 4.3%, its highest level since December 2021. This indicates that employers are cautious about hiring in an uncertain economic environment.
Compounding these worries, the retail sector itself is showing signs of weakness. The first half of 2025 marked the first major pullback for retailers since the pandemic, with nearly 15 million square feet of negative net absorption, meaning more space was vacated than leased. Early data also points to weaker consumer spending, particularly in discretionary categories, which directly impacts companies like Bath and Body Works.
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What Is The Market Telling Us
Bath and Body Works’s shares are very volatile and have had 25 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 1 day ago when the stock gained 3.9% as it continued a recent rally after the company presented its strategic initiatives at the Goldman Sachs Global Retailing Conference. The stock's momentum follows a 2.5% gain on Wednesday, when CEO Daniel Heath and CFO Eva Borrado outlined the company's plan to boost growth and brand perception. Key elements of the strategy include a strong focus on consumer-centric approaches, continuous product innovation, and compelling brand storytelling.
Adding to the positive sentiment, Bath & Body Works also launched its new Disney Villains Collection, a move aimed at creating products that celebrate creativity and sensory-driven storytelling.
Bath and Body Works is down 20.7% since the beginning of the year, and at $30.08 per share, it is trading 26.8% below its 52-week high of $41.08 from February 2025. Investors who bought $1,000 worth of Bath and Body Works’s shares 5 years ago would now be looking at an investment worth $1,040.
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