What happened

Stock in specialty retailer L Brands, Inc. (BBWI 1.94%) gained 30.3% last month, according to data from S&P Global Market Intelligence.

So what

Shares enjoyed a boost on the first day of the month when L Brands revealed in its monthly sales report that third-quarter 2017 earnings per share would reach the high end of its previously guided range of $0.25 to $0.30 per share. When released on Nov. 15, earnings indeed hit $0.30 per share for the quarter.

During the third quarter, revenue increased 1%, and comparable sales decreased by 1% versus the prior-year comparable quarter. Last year, L Brands made a strategic decision to exit swimwear and apparel within its Victoria's Secret segment. The exit impacted comparable sales negatively by 2% in the third quarter, meaning that the company achieved slightly positive "comps" of 1% when adjusting for the discontinued lines. 

The company's third-quarter report showed continued strength in the Bath & Body Works segment, which expanded sales by 6% to $815 million. This personal care products segment, the company's second-largest business after Victoria's Secret, has improved its top line by 5.4% during the first three quarters of 2017. That amounts to $122 million in additional sales over the prior year, which has partially offset a $474 million decline in Victoria's Secret's year-to-date revenue.

In its earnings conference call, management relayed that the company expects a reasonably successful holiday season, which will be characterized by margin discipline around a slate of planned promotional activity. 

Wedge-shaped exterior building lit at twilight.

Victoria's Secret New Bond Street location, London. Image source: L Brands, Inc.

Now what

Since the summer, L Brands has slowly climbed out of a stock price trough, assisted by improved earnings prospects.

LB Total Return Price Chart

LB total return price. Data by YCharts.

While brick-and-mortar retailers still feel significant industry pressure, L Brands shareholders are starting to grasp that the company's revenue woes aren't excessively dire. And a few bright spots could potentially spark future growth, including direct-to-customer sales, which expanded by 22% to $309.6 million in the Bath & Body Works segment during the first nine months of the year. Renewed shareholder confidence and general interest in beaten-down retail stocks may lead to a healthier stock chart for L Brand shares in 2018.