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Victoria's Secret, an angel on analysts' lists

Victoria's Secret models Alessandra Ambrosio and Adriana Lima (R) walk the runway during finale of the 2014 Victoria's Secret Fashion Show at Earls Court Exhibition Centre on Dec. 2, 2014, in London.
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Victoria's Secret models Alessandra Ambrosio and Adriana Lima (R) walk the runway during finale of the 2014 Victoria's Secret Fashion Show at Earls Court Exhibition Centre on Dec. 2, 2014, in London.

For a company renowned for its solid execution and consistent sales growth, the past two holidays have been a little less than merry for Victoria's Secret and its parent company, L Brands.

In 2012, the lingerie label left money on the table when it failed to be aggressive enough on promotions, and when its inventory fell short in key categories such as sleepwear. Last year, the company admitted that it "didn't execute as well as we should have"—a result of product misses in apparel, and a need to ramp up promotions late in the season.

But ahead of the premiere of Victoria's Secret's annual fashion show Tuesday, and with the 2014 holiday season in high gear, analysts said they are confident that L Brands will ride the momentum of its third-quarter earnings beat—as well as a robust 8 percent same-store sales gain in November—through the fourth quarter.

Read MoreLingerie to jewelry: What to buy her this year

It's accomplished these gains despite revenue in the broader intimates market dropping 3 percent in the year ended October, to $11.1 billion, according to the NPD Group.

Alessandra Ambrosio walks the runway at the annual Victoria's Secret fashion show at Earls Court on Dec. 2, 2014, in London.
Karwal Tang | WireImage | Getty Images
Alessandra Ambrosio walks the runway at the annual Victoria's Secret fashion show at Earls Court on Dec. 2, 2014, in London.
Model Izabel Goulart walks the runway during the 2014 Victoria's Secret Fashion Show at Earls Court Exhibition Centre on Dec. 2, 2014, in London.
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Model Izabel Goulart walks the runway during the 2014 Victoria's Secret Fashion Show at Earls Court Exhibition Centre on Dec. 2, 2014, in London.

"As most specialty retailers are reporting soft Black Friday/end of November results, L Brands bucked the trend (as has been the case all year long)," Sterne Agee analyst Ike Boruchow said following the company's November sales report. "With strong execution in PINK at Victoria's Secret and compelling in-store product launches at Bath & Body Works, we continue to see L Brands as a holiday winner."

According to L Brands' November report, both its Victoria's Secret and Bath & Body Work stores posted record sales on Black Friday. But it wasn't just the company's sales that impressed Boruchow. He noted that L Brands' merchandise margins were also up in November, signaling that its performance wasn't driven by the intense promotions plaguing apparel retailers.

The company also reported higher merchandise margins in the third quarter.

"That is hard to find (almost unheard of) in the mall universe these days," Wells Fargo analyst Paul Lejuez wrote following its earnings report.

Read MoreHolidays to separate retail winners from losers

For the fourth quarter, BMO Capital Markets analyst John Morris said he expects the company's margins to remain healthy, helped by inventory levels that are down 12 percent per square foot. He also pointed to strength in the retailer's fragrance segment as a reason for optimism, saying "strong momentum earlier in the year in fragrance typically translates into a healthy holiday gift in the category."

Analysts also pointed to opportunity from international expansion as a lever moving forward, with Boruchow saying this business could more than double over the next five years to more than $3 billion. To signal the brand's growing attention on the segment, Victoria's Secret moved its annual fashion show to London for the first time.

Still, not everyone is sold on L Brands. Jefferies analyst Randal Konik said he sees the company's momentum at risk, adding he's particularly cautious because its fourth quarter typically makes up more than half of its yearly earnings.

Read MoreA stock-picker's holiday shopping list

He cited Victoria's Secret's teen-focused PINK line as one concern, given the "fickle state of teen affairs."

Model Candice Swanepoel walks the runway during the 2014 Victoria's Secret Fashion Show at Earls Court Exhibition Centre on Dec. 2, 2014, in London.
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Model Candice Swanepoel walks the runway during the 2014 Victoria's Secret Fashion Show at Earls Court Exhibition Centre on Dec. 2, 2014, in London.
Model Cindy Bruna walks the runway at the annual Victoria's Secret fashion show at Earls Court on Dec. 2, 2014, in London.
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Model Cindy Bruna walks the runway at the annual Victoria's Secret fashion show at Earls Court on Dec. 2, 2014, in London.

Boruchow also noted that while L Brands' November performance was strong, it historically accounts for only about 25 percent of the company's fourth-quarter sales. That's because December, unsurprisingly, is its key month; January is also more important to the company than to most other retailers, because it holds semi-annual sales at Victoria's Secret and Bath & Body Works during the month.

Despite these challenges, Stifel Nicolaus analyst Richard Jaffe said he expects management to use last year's disappointing holiday as a lesson, and improve its execution this year. That includes more targeted promotions designed to preserve margins, as well as a more overt Christmas feeling in its stores.

"Despite a tough environment, we expect Victoria's Secret and Bath & Body Works to be leaders this holiday season," he said.

Kate Grigorieva walks the runway at the annual Victoria's Secret Fashion Show at Earls Court on Dec. 2, 2014, in London.
Karwal Tang | WireImage | Getty Images
Kate Grigorieva walks the runway at the annual Victoria's Secret Fashion Show at Earls Court on Dec. 2, 2014, in London.