Nu Skin Stock Sinks 40% in Six Months: Hold Steady or Time to Exit?

Core Viewpoint - Nu Skin Enterprises, Inc. (NUS) is experiencing significant challenges, with a 40.1% decline in share price over the past six months, underperforming the industry and broader market indices [1][5][12] Financial Performance - In Q3 2024, Nu Skin's revenues fell 13.8% year-over-year to $430.1 million, with sales leaders down 19$1.70 billion and $1.73 billion, indicating a 12-14$410 million and $445 million, reflecting a decline of 9% to 16% from the prior year [11] Cost Structure - Selling expenses as a percentage of revenues increased to 39% in Q3 2024 from 37.6% the previous year, with core business selling expenses rising to 43.5% [7] - The elevated cost structure poses risks to near-term profitability as revenues continue to decline [7] Macroeconomic Challenges - Persistent macroeconomic obstacles are affecting consumer spending in key markets like South Korea and China, alongside pressures in the U.S. direct selling industry [5][9] - Inflationary pressures, political uncertainty, and weak consumer sentiment are expected to persist into 2025 [9] Currency Fluctuations - Nu Skin's international presence exposes it to risks from volatile currency movements, with Q3 revenues impacted by a 3.4% negative effect from foreign currency fluctuations [6] - The company anticipates unfavorable foreign currency impacts of 1-2% and 3-4% on Q4 and 2024 revenues, respectively [6] Future Outlook - Management has lowered its 2024 outlook due to ongoing pressures in the core business, lacking clear visibility on when growth may resume [9][10] - Despite innovative launches and long-term strategies, current financial struggles suggest caution for investors in the short term [13]