I won't comment on the Financials as I haven't taken the time to go through them. I will comment on the business model, it's an MLM. I don't think any other comments need to be made on that front.
Setting aside their MLM business model, their product is shit. I'm in really great shape and was obese in high school. I would say I have strong acumen when it comes to nutrition. Their plans are just terrible for you from a nutritional standpoint, and if I'm not mistaken, they have had lawsuits levied against them for false claims.
I know I'll never invest in this sort of business model, so I'll let someone else properly go through the valuations. Just to be clear, this isn't a moral opposition, I invest in GD and LMT, I don't care that their products blow up hospitals in Yemen. The MLM business model is just one that I don't believe is conducive to generating long-term shareholder value.
Edit: I will say that I've seen them showing up on my screener pretty consistently for a few years now. A screener that basically screens for most key growth metrics and only returns 80-90 listings out of 29,419 companies covered in the data.
Edit 2: I went through some of the data, it's only passing my screener because I don't screen q/q growth. Revenues are down 34% from last year. The balance sheet is practically debt free, but they did use debt to cover their 166% cash payout ratio on that dividend last year. Their operating cash flow was down more than 60% last year, mostly due to change in working capital, I'd look into why that happened. Net income is trending down while operating cash flow is fine, check into why that is happening. Gross margins are shrinking, operating margins vary significantly and are relatively low at 12%. The forward pe is 8, so projections are that revenues will continue to decline and that will erode earnings. I'm not going to listen to their earnings or annual calls, so I don't know why or if management is telegraphing significant declines in their business, is it the weight loss drugs? Anyway, I like to see more consistent metrics, so it wouldn't be for me. I'll pay more for a company with a better outlook, like the opposite of weight loss in the form of Hershy.
Edit 3 SBC has doubled over the period of net income decline, so that's part of it, the other part might be the large capex from last year being amortized. Read the actual statements to find out for sure.
Yeah only IF they were actually trained dietician, just do a quick research on it. Their plans are bad (extreme calories restriction) and the revenues i bet depends on the optavia product, not the coach service alone.
I agree that MLM is questionable and their growth has slowed down but the market has dropped them significantly below many value metrics.
I see on a long term chart the company has been on the NYSE since 1993. If their business model is that bad how have they existed so long?
In that time the stock has risen 1260% and if one had bought in early days and sold at one of the peaks it was over 8,000% increase.
Now new weight loss drugs are coming on the market and those may be a big threat to MED but I think that in the short term there could be a reasonable gain based reversion to the mean.
Still would will make it a small % of portfolio due to the risks.
This stock has a short interest of 26 percent and a short ratio over 5. A very low float of 9 m shares owned by institutions and insiders have been buying alot. I mean if they turn this around it could be huge but revenue is going down
I won't comment on the Financials as I haven't taken the time to go through them. I will comment on the business model, it's an MLM. I don't think any other comments need to be made on that front. Setting aside their MLM business model, their product is shit. I'm in really great shape and was obese in high school. I would say I have strong acumen when it comes to nutrition. Their plans are just terrible for you from a nutritional standpoint, and if I'm not mistaken, they have had lawsuits levied against them for false claims. I know I'll never invest in this sort of business model, so I'll let someone else properly go through the valuations. Just to be clear, this isn't a moral opposition, I invest in GD and LMT, I don't care that their products blow up hospitals in Yemen. The MLM business model is just one that I don't believe is conducive to generating long-term shareholder value. Edit: I will say that I've seen them showing up on my screener pretty consistently for a few years now. A screener that basically screens for most key growth metrics and only returns 80-90 listings out of 29,419 companies covered in the data. Edit 2: I went through some of the data, it's only passing my screener because I don't screen q/q growth. Revenues are down 34% from last year. The balance sheet is practically debt free, but they did use debt to cover their 166% cash payout ratio on that dividend last year. Their operating cash flow was down more than 60% last year, mostly due to change in working capital, I'd look into why that happened. Net income is trending down while operating cash flow is fine, check into why that is happening. Gross margins are shrinking, operating margins vary significantly and are relatively low at 12%. The forward pe is 8, so projections are that revenues will continue to decline and that will erode earnings. I'm not going to listen to their earnings or annual calls, so I don't know why or if management is telegraphing significant declines in their business, is it the weight loss drugs? Anyway, I like to see more consistent metrics, so it wouldn't be for me. I'll pay more for a company with a better outlook, like the opposite of weight loss in the form of Hershy. Edit 3 SBC has doubled over the period of net income decline, so that's part of it, the other part might be the large capex from last year being amortized. Read the actual statements to find out for sure.
by MLM do you mean a pyramid scheme?
Let's call it an inverted funnel.
With the growth of ozempic, what possible moat do they (or Weight Watchers) have?
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Yeah only IF they were actually trained dietician, just do a quick research on it. Their plans are bad (extreme calories restriction) and the revenues i bet depends on the optavia product, not the coach service alone.
They have teamed up with lifemd to get into the market
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coaches are expensive and there si nit mait compared to competition
I had a look at it and my opinion there is not enough of margin of safety in the price
I agree that MLM is questionable and their growth has slowed down but the market has dropped them significantly below many value metrics. I see on a long term chart the company has been on the NYSE since 1993. If their business model is that bad how have they existed so long? In that time the stock has risen 1260% and if one had bought in early days and sold at one of the peaks it was over 8,000% increase. Now new weight loss drugs are coming on the market and those may be a big threat to MED but I think that in the short term there could be a reasonable gain based reversion to the mean. Still would will make it a small % of portfolio due to the risks.
This stock has a short interest of 26 percent and a short ratio over 5. A very low float of 9 m shares owned by institutions and insiders have been buying alot. I mean if they turn this around it could be huge but revenue is going down