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Can Robust Strategies Fuel Nu Skin's (NUS) Q4 Earnings?

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Nu Skin Enterprises, Inc. (NUS - Free Report) is slated to report fourth-quarter 2017 results on Feb 15, after the closing bell.

The company’s earnings have outpaced the Zacks Consensus Estimate in two out of the trailing four quarters, with an average positive surprise of 3.2%.

So, let’s look at how things are shaping up prior to the upcoming fourth-quarter results.

What to Expect?

The Zacks Consensus Estimate of $1.17 for the impending quarter has moved up by a penny in the last 30 days and also reflects a substantial growth of 48.1% from 79 cents in the year-ago quarter. Management had previously projected earnings per share in the range of $1.16-$1.21 for the quarter.

Nu Skin Enterprises, Inc. Price, Consensus and EPS Surprise

Nu Skin Enterprises, Inc. Price, Consensus and EPS Surprise | Nu Skin Enterprises, Inc. Quote

Moreover, analysts polled by Zacks expect revenues of $669.6 million reflecting a 26% increase from the year-ago reported figure. Earlier, management projected fourth-quarter revenues in the band of $650-$670 million, including nearly 1% adverse effect from currency translations.

Factors at Play

Nu Skin remains well on track with the execution of its growth strategy, which is contributing to the company’s performance. The company is benefiting from its strategic initiatives like product launches, innovations as well as increasing customer base and sales leaders. It also remains optimistic about ageLOC LumiSpa, which was launched recently and is likely to contribute revenues worth nearly $100 million in the quarter under review.

From a regional perspective, we note that the performance of the EMEA region has been positively impacting the company’s sales since last few quarters. Impressively, for the EMEA region, the Zacks Consensus Estimate for revenues in the fourth quarter stands at $52 million, which reflects a growth of 29.7% from the year-ago period sales. Also, the consensus estimates for the Americas, Mainland China and South Asia/Pacific are pegged at $93 million, $185 million and $93 million, representing year-over-year increases of 29.7%, 1.4% and 32.9% respectively.

However, currency headwind remains a major concern for the company, as it is expected to hurt fourth-quarter revenues. Also, management trimmed revenues and earnings view for 2017. The company expects revenues in the band of $2.26-$2.28 billion compared with the earlier projection of $2.26-$2.30 billion. The Zacks Consensus Estimate for revenues is pegged at $2.28 billion. Earnings for the year are envisioned in the band of $3.20-$3.25 per share compared with the previous range of $3.20-$3.30. The consensus mark stands at $3.24 for 2017.

What Does the Zacks Model Unveil?

Our proven model does not show that Nu Skin is likely to beat earnings estimates this quarter. This is because it does not have the right combination of the two key ingredients — a positive Earnings ESP and a Zacks Rank #3 (Hold) or better — to be confident of an earnings surprise call. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Nu Skin has an Earnings ESP of 0.00% as both the Most Accurate estimate and the Zacks Consensus Estimate are pegged at $1.17. The company carries a Zacks Rank #2 (Buy), which increases the predictive power of ESP. However, its ESP of 0.00% makes surprise prediction difficult.

Stocks With Favorable Combinations

Here are some companies which, according to our model, have the right combination of elements to deliver earnings beat.

The Boston Beer Company, Inc. (SAM - Free Report) has an Earnings ESP of +29.18% and a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Lowe's Companies, Inc. (LOW - Free Report) has an Earnings ESP of +3.25% and a Zacks Rank #2.

Inter Parfums, Inc. (IPAR - Free Report) has an Earnings ESP of +0.88% and a Zacks Rank of 3.

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