Nu Skin (NUS) Down 28% in 3 Months: What's the Next Best Move?

Core Insights - Nu Skin Enterprises, Inc. has experienced a significant decline in its stock, down 27.7% over the past three months, compared to a 21.3% decline in the industry and a 1.2% growth in the Zacks Consumer Staples sector [1] - The company is facing macroeconomic challenges that have negatively impacted consumer spending on premium products, alongside pressures in the direct selling industry [2][4] - Management has revised its annual revenue guidance for 2024 to a range of $1.73-$ 1.81 billion, indicating a decline of 12-8% from the previous year [4] Financial Performance - In Q2 2024, Nu Skin's revenues fell 12.2% year over year to $439.1 million, with a constant-currency decline of 8% [2] - The number of sales leaders decreased by 16% to 38,592, while the customer base dropped by 14% to 893,514 [2] - Paid affiliates decreased by 17% to 155,486, with an adjusted decline of 9% [2] Currency Impact - The company is significantly affected by foreign currency fluctuations, which contributed to a 4.2% negative impact on Q2 revenues [3] - Nu Skin anticipates unfavorable foreign currency impacts of around 4-3% on revenues for Q3 and the full year of 2024 [3] Future Projections - For Q3 2024, Nu Skin expects revenues between$ 430 million and $465 million, reflecting a decline of 14% to 7% from the previous year [4] - Adjusted earnings per share (EPS) for Q3 are projected to be between 15-25 cents, down from 56 cents in the same period last year [4] - The Zacks Consensus Estimate for 2024 EPS has decreased from$ 1.10 to 78 cents, indicating a negative sentiment among analysts [5] Strategic Initiatives - The company is pursuing strategic initiatives to enhance market presence and drive growth, including new product launches and leveraging its Rhyz business [6] - Despite these efforts, the combination of ongoing challenges and tighter guidance suggests a difficult path ahead for Nu Skin [6]