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WW International Stock Drops as Analysts Lower Targets

WW, formerly Weight Watchers, reported a 6.7% year-over-year decline in revenue and an earnings miss. Analysts cut their price targets.
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Shares of WW International  (WW) - Get Free Report lost about a quarter of their market value after investors and analysts assessed the former Weight Watchers' earnings report. 

The New York company reported second-quarter results and guidance that fell short of expectations. 

At last check WW shares were 26% lower at $23.81. They've traded on Wednesday down as much as 29% at $22.82.

Analysts at Jefferies downgraded the stock to hold from buy and its price target to $30 a share from $41.  

"[Second-quarter] member counts were in range, but the lowered outlook has shaken our confidence in revenue cadence and near-term momentum," analyst Stephanie Wissink said, according to Bloomberg. 

Truist analyst Michael Swartz affirmed the investment firm's hold rating while lowering the price target to $26 from $28. "Surprising [second-quarter] miss and disappointing 2021 guidance" were a "punch to the gut," from the company, he wrote. 

The investment firm sees the near-term digital outlook as being the main driver of the stock's dip for investors.

Morgan Stanley's Lauren Schenk maintained an equal-weight rating while lowering her price target to $31 from $34. 

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The company's results and outlook are "disappointing, but not surprising given what we saw from an app download perspective," she said.

Schenk sees the stock's drop as "overdone" due to the fact that the firm doesn't see "material changes" to its medium-term and long-term financial estimates besides a "slightly lower base."

Weight Watchers reported second-quarter earnings of 12 cents a share -- reflecting charges of 36 cents -- compared with the FactSet consensus estimate of 68 cents. Revenue fell 6.7% from a year earlier to $311.4 million vs. the estimate of $337.5 million.