Nu Skin Enterprises (NUS) spiked 13% in extended trading on Wednesday after the skin care products maker ramped up its sales estimates for the second quarter as online transactions grow.
Shares jumped to $43.45 in after-market trading. Nu Skin said it expects revenues in the second quarter to be in the range of $603 to $608 million. This compares with a previous forecast of $520 to $550 million. The company is scheduled to report its second-quarter results and provide a revised outlook for the full-year on Aug. 5.
“We are pleased to report that our expected revenue for the second quarter is well ahead of our previous guidance, driven by strong global customer growth with particular strength in the Americas and Europe,” said Nu Skin CEO Ritch Wood. “The trends we are seeing are a credit to the adaptability and hard work of our global sales force and the enduring value of our products.”
Wood added that Nu Skin’s investments in technology and into its digital capabilities have been a critical driver of performance and business continuity in the second quarter, with online transactions accounting for more than 80% of volume.
Nu Skin shares have this year more than tripled since reaching a low in mid-March and are now trading close to their start-of-the-year level.
Nonetheless Citigroup analyst Wendy Nicholson late last month raised the stock’s price target to $41 from $29, pointing to the importance of Nu Skin’s ongoing digital investments.
Nicholson maintains a Hold rating on the company as China sales are expected to be down 20%, but she sees less downside risk to this business and expects sales declines to moderate.
The rest of the Wall Street community shares Nicholson’s outlook. The Hold analyst consensus breaks down into 5 Hold ratings versus 1 Buy rating. Meanwhile, the $38.80 average price target suggests that shares are almost fully priced. (See Nu Skin stock analysis on TipRanks)
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