Stock (Symbol) |
Natural Health Trends (NHTC) |
Stock Price |
$44 |
Sector |
| Food & Necessities |
Data is as of |
| October 29, 2015 |
Expected to Report |
| Mar 1 – Mar 7 |
Company Description |
 Natural Health Trends Corp. is a direct-selling and e-commerce company. The Company offers a line of NHT Global branded products, including wellness, skincare and lifestyle. The Company sells its products to a network of consumers or business builders that either uses the products themselves or resells them to consumers. Its wholly owned subsidiaries have presence in the markets, which include North America; Greater China, which consists of Hong Kong, Taiwan and China; Russia; South Korea; Japan; and Europe, which consists of Italy and Slovenia. The Company offers wellness products, such as liquid, encapsulated, tableted and powder dietary and nutritional supplements, herbal supplements, vitamins and minerals. It offers Beauty products, such as anti-aging and hydrating cleansers, creams, lotions, serums and toners to moisturize protect and improve the appearance of skin. It also offers lifestyle products, such as supplements and topical gels for improved vitality. Source: Thomson Financial |
Sharek’s Take |
 Natural Health Trends (NHTC) is one of the fastest growing companies in the world, and also looks to be solidly run. The company sells beauty and wellness products. Based in Dallas, NHTC does business in Hong Kong and sells its merchandise in China using a direct sales team. Sales and profits have been exploding, with revenue growth of 154% and profit growth of 181% in the qtr just reported. NHTC has been a high-flyer this year, so there is risk in buying up here. But the company should earn $4 this year and is selling for 11x that. Here’s recent qtrly profits: $0.03, $0.08, $0.12, $0.13, $0.26, $0.49, $0.42, $0.44, $0.54, $0.98, and just this week $1.18. The stock broke out yesterday on the news and is following through today so I will purchase a small amount for clients in the Growth Portfolio and Aggressive Growth Portfolio. |
One Year Chart |
 NHTC has been growing exponentially. Triple-digit profit growth in each of the last 4 qtrs, but with no Estimates we are driving through the fog. My guess is the company will have triple-digit growth for another 2 qtrs. My guess is NHTC will make $4 this year, and that would be a P/E of just 11. There’s a lot of risk up here as the stock is up from $10 to $45 in a year. But the recent correction shook out a lot of weak shareholders, so maybe NHTC is ready to make another move higher. Still, I wouldn’t make this a big investment in your portfolio. |
Fair Value |
 NHTC doesn’t have many followers as it is a small cap with only a $550 million market cap. There are no analysts with earnings estimates, which is good because the stock isn’t getting picked up in some hedge fund computer screens. Still, the management seems to be solid. The company pays a dividend — which it just increased — and buys back its own stock. In 2014 NHTC made $1.61 and paid out $0.30 in dividends. It’s current buy-back program is $15 million which is a lot considering the company did $80 million in sales last qtr ($125 million all of last year). Seems like a little gem, but there are risks. Direct sales sometimes gets companies into issues with regulations, especially in China, so that hurts NHTC’s Fair Value P/E. So I feel the stock is worth just 14x earnings. There is also headline risk, as a short seller could research the company as well as its products and produce a negative research report. But the way the company is growing it could make $4 this year and $6 in 2016 or 2017. |
Bottom Line |
 Natural Health Trends is one of the worlds fastest growing companies, with a stock to match. The stock is up big on the year, but recently had a correction which shook out some weak shareholders. Still, there are multiple risks in owning this stock, thus I will buy small portions for clients in my growth accounts. NHTC has good things going for it including a rising dividend and stock buyback program.NHTC will rank 14th of 30 stocks in the Growth Portfolio Power Rankings and 14th of 14 stocks in the Aggressive Growth Portfolio Power Rankings. |
Power Rankings |
Growth Stock Portfolio
14 of 30Aggressive Growth Portfolio 14 of 14Conservative Stock Portfolio N/A |
