Nu Skin Enterprises (NUS) develops and sells personal care, as well as wellness products, all over the world.
Let’s take a look at the company’s latest financial performance and risk factors. (See Nu Skin Enterprises stock charts on TipRanks)
Nu Skin Enterprises’ Financial Performance
Total revenues were $704.1 million in Q2, which grew 15% year-over-year. Further, revenues outpaced the consensus estimate of $702.4 million.
Meanwhile, earnings per share increased 42% year-over-year to $1.15 per share, outpacing the consensus estimate of $1.04 a share.
Nu Skin Enterprises CFO Mark Lawrence commented on the earnings growth and said, “We reported 42% EPS growth driven by strong improvements in both gross margin and operating margin as a result of continued expense control and supply chain efficiency.”
Nu Skin Enterprises Health Risk Factors
According to the new TipRanks Risk Factors tool, Nu Skin Enterprises’ main risk category is Macro & Political, which accounts for 43% of the total 14 risks identified.
Since June, Nu Skin Enterprises has updated its risk profile to introduce two new risk factors under the Macro & Political category.
First, under the Economy & Political Environment sub-category, the company said, “Difficult economic conditions could harm our business.”
Here, Nu Skin warns that severe economic situations, such as high unemployment or a recession, might result in a drop in demand for its goods. In addition, Nu Skin is concerned about rising inflation. Investors should be mindful that future inflationary pressures may have a detrimental impact on consumers’ spending power.
Under the Natural and Human Disruptions sub-category, the company said, “Epidemics, including the recent outbreak of COVID-19 and other crises have and may continue to negatively impact our business.”
The company highlights that any outbreak or crisis that causes individuals to avoid group meetings or gatherings might have an influence on the firm’s financial results. As a result of the COVID-19 outbreak, the company was forced to temporarily close a number of sites, affecting the supply chain, logistics, and other business activities.
Furthermore, the firm warns investors that the spread of the Delta variant, or other variants, may continue to harm the company’s performance.
Wall Street’s Take
Following the second-quarter earnings release, DA Davidson analyst Linda Bolton Weiser reiterated a Hold rating on the stock, but decreased her price target to $60 from $61. This implies 42.3% upside potential to current levels.
Overall, the stock has a Moderate Buy rating, based on one Buy and two Holds.
The average NUS price target is $63, reflecting potential 12-month upside of 49.4% from current levels.
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