| Stock (Symbol) | Stock Price | |
Weight Watchers (WTW) |
$72 |
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| Data is as of | Expected to Report | Sector |
June 23, 2011 |
Aug 1 |
Retail & Restaurant |
| Sharek’s Take | ||
 WTW is having its best year ever! Profits are expected to come in close to $4 a share, after being between $2-$3 in each of the past five years. Weight Watchers is a growth stock because of its online initiative and Points Plus program. Points Plus is Weight Watchers’ new-and-improved poitns program that lowers the points for good food (like fruit) and raises the points for bad food (like alcohal). Online generates around 15% of revenue but around 25% of profits, and this side of the business could grow 40-50% in 2011. |
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| One-Year Chart | ||
 Since last quarter WTW’s P/E has gone up from 16 (undervalued, and in green) to 18 (close to fair value, and in black).The profit growth of 72% last quarter was great and estiamtes show 53% coming the next two quarters. This is Weight Watchers’ best year ever! |
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| Earnings Table | ||
 Sales rose 30% last quarter, up from 14% two quarters ago. North American sales rose 35% compared to 16% two quarters ago. Online sales jumped a heafty 66% (no pun uintended).WTW beat by 12 cents but this wasn’t so great because this figure just got upped by 27 cents a quarter ago. I was thinking the company had the opportunity to knock the cover off the ball, instead it hit a double. BIG increases in Annual Profit Estimates continue. This is really good. Quarterly estimates look awesome for the next three quarters — and these numbers have increased for two straight quarters. The 4QtrsOut estimate needs some time in the oven (I’m on a roll here — hah! another joke!) |
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| Fair Value | ||
 Im keeping the Fair Value at 21 times earnings, as it was last quarter. Since estimates are increasing, WTW’s Fair Value might later in the year as well. |
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| Ten-Year Chart | ||
 WTW is a stock I really started to like in 2006-2007. Profits were hitting record highs and growing around 20%. The stock was flatlining. The stock fell during the bear market yet profits only fell 12% in 2009 (not bad considering the economy). This year’s profits will be way more than the company had ever earned. |
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| Power Ranking | Bottom Line | |
Growth Portfolio
10 of 22 |
I purchased WTW for clients last quarter after the company said profits were going to come in WAY over projections. This quarter the data is very good — just not great like last quarter. Upside isn’t that great either. Weight Watchers is ranked 11th in the 21 stock Growth Portfolio Power Rankings. WTW is ranked 10th of 11 stocks in the Aggressive Growth Portfolio, and I might sell it from thsi portfolio if I like something better. |
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Aggressive Growth Portfolio
11 of 11 |
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