| Stock (Symbol) | Stock Price | |
Weight Watchers (WTW) |
$59 |
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| Data is as of | Expected to Report | Sector |
September 29, 2011 |
Nov 9 |
Retail & Restaurant |
| Sharek’s Take | ||
 Weight Watchers is having a banner year, yet many money managers doubt the current rapid growth is sustainable. 2011 is going great because of Points Plus, Weight Watchers’ new-and-improved points program that lowers the points for good food (like fruit) and raises the points for bad food (like alcohol).Revenue grew 29% last quarter and 30% two quarters ago. Expectations are solid for the next two (Sept. & Dec. 2011) but then analysts think revenue growth could slow to 10%. Will that happen? I don’t know. The trend is your friend and the trend is up. |
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| One-Year Chart | ||
 WTW fell after reporting earnings back in early August. I think there was some fast money in this stock after the company upped guidance back in February. There’s big spikes in weekly volume during both big moves.WTW is slightly undervalued with its 15 P/E. I don’t think the stock has much downside risk. |
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| Earnings Table | ||
 Profits jumped 60% last quarter as sales rose 29%. North American sales rose 24%. Online sales jumped an amazing 74%.WTW beat by 5 cents, but momentum is slowing in the beat-the-street department. 2QtrsAgo, profit estimates got upped and beat by a total of 39 cents in six months. LastQtr that number was only 9 cents. Annual Profit Estimates increased, but not so much. Momentum here remains positive, yet is slowing. Quarterly estimates look solid for the next six months, then are set to slow in 2012. These figures are the key to WTW being a growth stock. I hope profit growth can continue to grow 20-25%. |
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| Fair Value | ||
 WTW’s Fair Value P/E drops from 21 last quarter to 17 this quarter. This stock market isn’t valuing companies very high, and WTW’s growth could slow next year. Upside is good, not great. |
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| Ten-Year Chart | ||
 This ten-year chart isn’t-all-that. The stock built a nice base until October 2007, then couldn’t break out to new highs. The 2008-2009 recession hurt the stock and company profits. 2010 saw a comeback and in early 2011 WTW soared when management guided annual estimates way higher. But then momentum couldn’t keep going and the stock flattened out, until it came down with the recent market fall. |
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| Power Ranking | Bottom Line | |
Growth Portfolio
14 of 21 |
Weight Watchers continues to do extremely well with its quarterly results. The real question is will growth slow in 2011. I don’t have that answer yet. Weight Watchers is ranked 14th in the 21 stock Growth Portfolio Power Rankings. The stock was recently sold from the Aggressive Growth Portfolio. |
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Aggressive Growth Portfolio
N/A |
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