Why Victoria’s Secret Stock Soared Today

Actions of Victoria’s Secret (VSCO 16.41%) rose today after the struggling clothing company named a new CEO, Hillary Super. Investors seem to be hoping that the move will lead to a turnaround in the business.

As of 1:17 pm ET on Wednesday, the stock was up 14.6% on the news.

Meet the new boss

Victoria’s Secret said this morning that Super will replace Martin Waters as CEO and board member, taking over on September 9.

Most recently, Super was the CEO of Savage X Fenty, the intimates and accessories brand, and the global CEO of Anthropologie, which is owned by Urban Outfitters. The company said she brings three decades of experience in merchandising, with chairman of the board Donna James adding: “VS&Co welcomes Hillary as our new CEO to support the next chapter of the business and deliver the core tenet of our transformation strategy: accelerating growth in our core business in North America.”

Buyer carrying bags of goods.

Separately, the company reported preliminary second-quarter results that were slightly better than guidance, with sales falling 1% to 2%, compared with guidance for a 1% to 3% decline.

Even better, adjusted earnings per share are on track to be well ahead of guidance, coming in at $0.34 to $0.39, compared to its forecast of $0.05 to $0.20.

Can Super transform the business?

Victoria’s Secret is a shadow of its former self and worth a fraction of what it was at its peak about a decade ago, when it was the cornerstone of L Brands.

A return to this status is unlikely as the market for women’s intimates has changed and new competition has entered the arena, but there are potential improvements to be made in the business. Returning to sales growth is one of them.

Keep an eye out for new initiatives from Super as she takes over; investors may respond favorably to subsequent changes in apparel stock.