FASHION

Victoria’s Secret Is Relying On Nostalgia To Revitalize Its Stock, Bringing Back Its Decades-Long Fashion Show

Victoria’s Secret ($VSCO) has a dirty little secret — it was founded by a man, for men. Since 2020, the company has struggled to shake its sexist, out-of-touch reputation — and efforts to grow into a woman-run, feminist, inclusive brand have been rocky, leading to the departure of its first female CEO and accusations of being “too woke.” This has pushed its stock down nearly 50% since it split from L Brands ($BBWI) in 2021 — and now the company is hoping a little nostalgia can help turn things around.

Bringing sexy back: Six years ago, Victoria’s Secret canceled its famous Fashion Show amid criticism of the brand and its famous Angel supermodels. Shortly after, the company’s sales decreased steadily — now it’s on track for its fourth straight year of decline. And to remedy that, they’ve announced the return of the Fashion Show this fall.

• Last year, Victoria’s Secret management declared they were done putting ‘wokeness’ over ‘sexiness,’ signaling a shift away from their recent focus on female empowerment and back towards their traditionally male audience.

• This came after the stock had its worst day ever in March, plunging 26% due to disappointing holiday sales.

Can glamour boost the bottom line?

The Victoria’s Secret Angels might have been novel years ago, but today, they face stiff competition. Almost every major competitor has launched their own show, often with a more modern and progressive approach. This raises a key question for investors: can the Angels really help $VSCO maintain its top spot in the lingerie market?

• American Eagle’s ($AEO) Aerie and Urban Outfitters ($URBN) have successfully taken market share from VS by appealing to women without being overtly political.

• Other fast-growing brands have even tested the markets, with Rihanna’s Savage X Fenty lining up an IPO, while shapewear giant SPANX sold a majority stake to Blackstone ($BX).

Will it stun or flop on the runway? A Victoria’s Secret rep says the new show will be more inclusive than in the past, directed by women, and designed to appeal to a wider audience. But with lingerie sales down industry-wide for four consecutive quarters, it’s unclear if skeptical shoppers will be interested in what Victoria’s Secret offers.

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This Texas Retiree Used Trading Income To Pay For His New Ranch. Could It Work For You Too?

Gold is shining and it’s difficult to ignore its massive run: Gold has outperformed both the Nasdaq and S&P 500 this year— and with interest rate cuts coming this year, Bank of America’s Head of Commodities Research expects prices to soar past $3K. Get the free report to learn how to add gold to your portfolio →*

Markets & Economy

Yellen opposes global billionaire tax: Some countries like Brazil and France want to tax billionaires everywhere, making it harder for the megarich to duck taxes by storing wealth overseas. Treasury Secretary Janet Yellen says the US supports progressive taxation — but won’t consider a billionaire tax. [Read]

Iran’s President Raisi dies in helicopter crash: Raisi’s helicopter went down amid foggy weather, leaving Iran’s already-tense political picture even more uncertain. For now, the VP is in charge and must hold an election within 50 days. [Read]

Europe wants to boost its military machine: The Russian invasion of Ukraine was a wake-up call to increase defense spending — but coordinating EU member states around a unified vision for defense comes with plenty of political and logistical hurdles. [Read]

Business & Wealth

Sonos ($SONO) to unveil its “most requested product” today: Most expect wireless headphones, which customers have wanted for years. A TV streaming app and a new soundbar are also possibilities, though we might have to wait a bit longer for those. [Read]

Plane tickets could be cheaper this summer: Flight prices fell 5.8% from April last year to this April and are down another 1% in the last month. But if you’re headed to popular spots like Tokyo, Thailand, or South America, expect to pay more. Booking ahead can save you money (1-3 months for domestic, 3-4 months for international). [Read]

Is staging your home worth it? It costs~18% more to stage your home now than it did before the pandemic. Realtors generally say it’s worth it if you want to sell your home faster, especially if it’s empty or has flaws you’d like to distract from. [Read]

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DIGIT OF THE DAY

CEO Paychecks Are Getting Bigger, and Some Are Worth $50M or More

CEOs are raking in the big bucks, and it’s not just a few outliers. Ever since Elon Musk got a jaw-dropping $55B executive pay package in 2018, more and more CEOs are seeing massive increases in their compensation. This trend, called the “Musk Effect,” is largely due to bigger stock options. Companies can’t write off executive cash pay over $1M anymore, so stock options are a tax-savvy way to tie executive pay to company performance.

• In the last five years, 36 CEOs of companies in the S&P 500 landed pay packages worth $50M+ — way up from just nine CEOs before Musk’s big payday — with the total cost of these packages quadrupling since then.

• Last year, Broadcom's ($AVGO) Hock Tan took home $162M, while Nikesh Arora of Palo Alto Networks ($PANW) received $151M — placing them among the top earners in the S&P 500.

The great divide: Americans are pushing back against exorbitant CEO pay — with a whopping 80% of likely voters supporting taxing companies where the CEO makes 50x or more than their median worker. The Institute for Policy Studies and Americans for Tax Fairness are on board with this, too. They found that from 2018 to 2022, top execs at many major US companies made more money than their companies paid in federal taxes. They argue that corporate tax cuts and excessive executive pay are worsening income and wealth inequality.

Read: Proxy Elections Could Change Corporate America — But Most Americans Don’t Even Know About Them