E_Y_E/iStock Unreleased via Getty Images

E_Y_E/iStock Unreleased via Getty Images

Bath & Body Works (NYSE:BBWI ) was one of the few stocks not receiving a reprieve from recent selling pressure on Tuesday.

Much to the contrary, the stock was the second biggest laggard in the S&P on the day, falling by double digits to touch levels unseen since January 2021 at its intraday low. Its losses were only eclipsed by DaVita which suffered a blow from a Supreme Court ruling early in the day’s trading session.

While a specific catalyst for the step drop in Bath & Body Works (BBWI) shares was not as evident as it was in the case of DaVita, the stock has been seen as a victim of pandemic trends turning. Namely, the company’s strong sales in soaps and hand sanitizers were crucial to its rise to highs of over $80 per share.

To be sure, bullish analysts have battled against this narrative, instead arguing that the company’s recent positive earnings results have been more broad-based. Indeed, both UBS and Wells Fargo recently argued that the company should maintain pricing power even as inflation runs hot and consumers tighten their belts. As of yet, the market has not reflected this more optimistic vantage point.

It is also worth noting that option volume surged on the day, according to Bloomberg data, with July 1, $32 puts pacing the action.

Read more about Melvin Capital’s position in Bath & Body Works (BBWI) as of its last 13-F filing.