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Zacks Investment Research upgraded Nu Skin Enterprises Inc (NUS - Snapshot Report) to a Zacks Rank #1 (Strong Buy) on Dec 2, as the company projects double-digit year-over-year growth for earnings and revenue for fiscal 2014. In fact, the company has been gaining momentum ever since it reported strong third quarter 2013 results.

Why the Upgrade?

Nu Skin’s strong innovation program backed by its latest ageLOC TR90 system led the company drive its fiscal 2014 guidance, which was announced on Nov 21. The company expects earnings per share to grow 25%-30% on a year-over-year basis to $7.25 - $7.50 for fiscal 2014. Revenues for fiscal 2014 are expected in the range of $3.9 - $4.0 billion, up 22% - 25% from the prior year, despite an anticipated unfavorable foreign currency impact of 3%.

The company is very optimistic about its ageLOC TR90, a weight management and body shaping system and the latest in the ageLOC anti-aging product line, which is driving the company’s profits. Nu Skin’s ageLOC anti-aging products focus on providing nutritional and skin care solutions that target the sources of aging.

Started in Sep 2013, the ageLOC TR90 weight management system was well received in the Greater China and South Asia/Pacific regions and generated approximately $205 million in limited-time offer sales in the third quarter of 2013. The company expects this momentum to continue through 2014.

Nu Skin also reported strong third quarter 2013 results on Oct 31. Earnings of $1.80 per share improved significantly from the prior-year quarter, posting a 107% increase. Earnings also surpassed the Zacks Consensus Estimate by 27%. The upswing in earnings was driven by higher sales in the Greater China and South Asia/Pacific regions, as well as in South Korea. Higher margins and lower quarterly tax rate also led to earnings growth in the quarter.

Despite a 3% unfavorable impact from currency, sales increased 76% to $927.6 million in the quarter. Sales were way ahead of the Zacks Consensus Estimate of $815 million. The successful execution of the ageLOC TR90 weight management system drove sales in the quarter.

The company's gross margin during the quarter also shot up 140 basis points to 84.9%, primarily due to the TR90 launch in Greater China and South Asia/Pacific. Operating margin improved 240 basis points to 18.1% in the third quarter as a result of strong sales.

Following the strong third quarter results, Nu Skin raised its 2013 revenue guidance to the range of $3.18 - $3.21 billion, up from its previous guidance of $2.83-$2.86 billion. The new guidance includes a projected negative currency impact of 4% for the year, lower than 5% expected previously. The company now expects 2013 earnings to be $5.77 to $5.82 per share, up from $4.85 to $5.00 per share expected previously.

Other Stocks to Consider

Other players in the consumer staples sector which look attractive at current levels includes Omega Protein Corp , Diamond Foods Inc (DMND - Analyst Report) and Pinnacle Foods Inc (PF - Snapshot Report). While Omega and Diamond Foods sport a Zacks Rank #1 (Strong Buy), Pinnacle carries a Zacks Rank #2 (Buy).

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