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Nu Skin (NUS) Up 8.8% Since Last Earnings Report: Can It Continue?
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A month has gone by since the last earnings report for Nu Skin Enterprises (NUS - Free Report) . Shares have added about 8.8% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Nu Skin due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Nu Skin Lowers 2022 View Despite Q1 Earnings Beat
Nu Skin delivered first-quarter 2022 results, with the top and the bottom line beating the Zacks Consensus Estimate. However, revenues and earnings declined year over year. Nu Skin reported quarterly earnings of 76 cents per share, down 16% from 91 cents per share reported in the year-ago quarter. The metric beat the Zacks Consensus Estimate of 73 cents per share.
Revenues of $604.9 million fell 11% year over year on a reported basis. Revenues included a negative impact of 3% from foreign currency fluctuations. On a constant-currency (cc) basis, revenues declined 8%. The top line surpassed the Zacks Consensus Estimate of $579 million.
Management highlighted that it witnessed solid demand for its recent product introductions — ageLOC Meta and Beauty Focus Collagen+. The solid performance of these product launches aided revenue growth across markets like the United States, Taiwan and Southeast Asia. Its businesses in Mainland China and other markets were hurt by major pandemic-induced lockdowns and other factors. In addition, the conflict in Ukraine and Russia affected the company’s business in the EMEA region. Sales leaders were down 22% year over year to 52,462. Nu Skin’s customer base dropped 13% to 1,321,451. The company’spaid affiliates were down 14% to 251,436.
Gross profit of $443.4 million declined from $506.5 million reported in the year-ago quarter. The gross margin contracted year over year from 74.8% to 73.3%. The downside can be attributed to product mix and promotions. Nu Skin business’ gross margin contracted to 76.5% from 77.8%.
Selling expenses declined from almost $276 million in the prior-year quarter to $242.7 million. As a percentage of sales, the metric came in at 40.1%, down from 40.8% reported in the year-ago quarter. Nu Skin business’ selling expenses were 43% of sales, down from 43.7% in the year-ago quarter. General and administrative expenses of $148.6 million declined from $167.6 million in the year-ago quarter. As a percentage of sales, general and administrative expenses declined from 24.8% to 24.6%. Operating income of $52.1 million declined from $62.9 million in the year-ago quarter. The operating margin was 8.6%, down from 9.3% reported in the year-ago quarter.
Segment-wise, revenues (at cc) declined 18% in Mainland China, 6% in the Americas, 4% in South Korea, 3% in Japan and 25% in EMEA. The same rose 11% in Southeast Asia/Pacific and 6% in Hong Kong/Taiwan region. Total Nu Skin revenues of $564.3 million fell 8% at cc from the prior-year quarter’s figure of $631 million.
Guidance
The company now anticipates 2022 revenues in the range of $2.51-$2.62 billion, calling for a 3-7% decline from the year-ago period’s reported figure.The company envisions an unfavorable currency impact of 3-4% on 2022 revenues. The company had earlier anticipated revenues in the range of $2.66-$2.77 billion, calling for a 1% decline to 3% growth from the year-ago period’s reported figure.
Management now expects 2022 earnings per share (EPS) in the range of $3.60-$3.90, indicating an increase of 26-36% on a reported basis. The metric is expected to fall 6-13% on an adjusted basis. Earlier, management expected EPS in the range of $4.05-$4.45.
For second-quarter 2022, the company projects revenues of $590-$620 million that include unfavorable currency impacts of 3-4%. The projection suggests a 12-16% decline from the year-ago quarter’s level. The company’s quarterly EPS is anticipated to be between 75 and 85 cents, indicating a 26-35% slump from the year-ago quarter’s levels.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision have trended downward during the past month.
The consensus estimate has shifted -33.06% due to these changes.
VGM Scores
Currently, Nu Skin has an average Growth Score of C, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of A on the value side, putting it in the top 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. It's no surprise Nu Skin has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.
Performance of an Industry Player
Nu Skin is part of the Zacks Cosmetics industry. Over the past month, Estee Lauder (EL - Free Report) , a stock from the same industry, has gained 9.3%. The company reported its results for the quarter ended March 2022 more than a month ago.
Estee Lauder reported revenues of $4.25 billion in the last reported quarter, representing a year-over-year change of +9.9%. EPS of $1.90 for the same period compares with $1.62 a year ago.
Estee Lauder is expected to post earnings of $0.34 per share for the current quarter, representing a year-over-year change of -56.4%. Over the last 30 days, the Zacks Consensus Estimate has changed -46.6%.
Estee Lauder has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of F.
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Nu Skin (NUS) Up 8.8% Since Last Earnings Report: Can It Continue?
A month has gone by since the last earnings report for Nu Skin Enterprises (NUS - Free Report) . Shares have added about 8.8% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Nu Skin due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Nu Skin Lowers 2022 View Despite Q1 Earnings Beat
Nu Skin delivered first-quarter 2022 results, with the top and the bottom line beating the Zacks Consensus Estimate. However, revenues and earnings declined year over year. Nu Skin reported quarterly earnings of 76 cents per share, down 16% from 91 cents per share reported in the year-ago quarter. The metric beat the Zacks Consensus Estimate of 73 cents per share.
Revenues of $604.9 million fell 11% year over year on a reported basis. Revenues included a negative impact of 3% from foreign currency fluctuations. On a constant-currency (cc) basis, revenues declined 8%. The top line surpassed the Zacks Consensus Estimate of $579 million.
Management highlighted that it witnessed solid demand for its recent product introductions — ageLOC Meta and Beauty Focus Collagen+. The solid performance of these product launches aided revenue growth across markets like the United States, Taiwan and Southeast Asia. Its businesses in Mainland China and other markets were hurt by major pandemic-induced lockdowns and other factors. In addition, the conflict in Ukraine and Russia affected the company’s business in the EMEA region. Sales leaders were down 22% year over year to 52,462. Nu Skin’s customer base dropped 13% to 1,321,451. The company’spaid affiliates were down 14% to 251,436.
Gross profit of $443.4 million declined from $506.5 million reported in the year-ago quarter. The gross margin contracted year over year from 74.8% to 73.3%. The downside can be attributed to product mix and promotions. Nu Skin business’ gross margin contracted to 76.5% from 77.8%.
Selling expenses declined from almost $276 million in the prior-year quarter to $242.7 million. As a percentage of sales, the metric came in at 40.1%, down from 40.8% reported in the year-ago quarter. Nu Skin business’ selling expenses were 43% of sales, down from 43.7% in the year-ago quarter. General and administrative expenses of $148.6 million declined from $167.6 million in the year-ago quarter. As a percentage of sales, general and administrative expenses declined from 24.8% to 24.6%. Operating income of $52.1 million declined from $62.9 million in the year-ago quarter. The operating margin was 8.6%, down from 9.3% reported in the year-ago quarter.
Segment-wise, revenues (at cc) declined 18% in Mainland China, 6% in the Americas, 4% in South Korea, 3% in Japan and 25% in EMEA. The same rose 11% in Southeast Asia/Pacific and 6% in Hong Kong/Taiwan region. Total Nu Skin revenues of $564.3 million fell 8% at cc from the prior-year quarter’s figure of $631 million.
Guidance
The company now anticipates 2022 revenues in the range of $2.51-$2.62 billion, calling for a 3-7% decline from the year-ago period’s reported figure.The company envisions an unfavorable currency impact of 3-4% on 2022 revenues. The company had earlier anticipated revenues in the range of $2.66-$2.77 billion, calling for a 1% decline to 3% growth from the year-ago period’s reported figure.
Management now expects 2022 earnings per share (EPS) in the range of $3.60-$3.90, indicating an increase of 26-36% on a reported basis. The metric is expected to fall 6-13% on an adjusted basis. Earlier, management expected EPS in the range of $4.05-$4.45.
For second-quarter 2022, the company projects revenues of $590-$620 million that include unfavorable currency impacts of 3-4%. The projection suggests a 12-16% decline from the year-ago quarter’s level. The company’s quarterly EPS is anticipated to be between 75 and 85 cents, indicating a 26-35% slump from the year-ago quarter’s levels.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision have trended downward during the past month.
The consensus estimate has shifted -33.06% due to these changes.
VGM Scores
Currently, Nu Skin has an average Growth Score of C, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of A on the value side, putting it in the top 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. It's no surprise Nu Skin has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.
Performance of an Industry Player
Nu Skin is part of the Zacks Cosmetics industry. Over the past month, Estee Lauder (EL - Free Report) , a stock from the same industry, has gained 9.3%. The company reported its results for the quarter ended March 2022 more than a month ago.
Estee Lauder reported revenues of $4.25 billion in the last reported quarter, representing a year-over-year change of +9.9%. EPS of $1.90 for the same period compares with $1.62 a year ago.
Estee Lauder is expected to post earnings of $0.34 per share for the current quarter, representing a year-over-year change of -56.4%. Over the last 30 days, the Zacks Consensus Estimate has changed -46.6%.
Estee Lauder has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of F.