Will This Ratings Downgrade Hurt Nu Skin (NUS) Stock Today?

NEW YORK (TheStreet) -- Nu Skin Enterprises Inc. (NUS) was downgraded to "neutral" from "overweight" at JPMorgan (JPM) on Thursday.

The firm said it lowered its rating on the cosmetic, personal care, and nutrition company based on risks remaining in the shares.

JPMorgan cut its price target on the stock in half to $50 from $100.

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Shares of Nu Skin are down by -0.04% to $46.50 in pre-market trading this morning.

Separately, TheStreet Ratings team rates NU SKIN ENTERPRISES as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:

"We rate NU SKIN ENTERPRISES (NUS) a BUY. This is driven by several positive factors, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its robust revenue growth, impressive record of earnings per share growth, compelling growth in net income, notable return on equity and reasonable valuation levels. We feel these strengths outweigh the fact that the company shows weak operating cash flow."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The revenue growth came in higher than the industry average of 1.5%. Since the same quarter one year prior, revenues rose by 24.0%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • NU SKIN ENTERPRISES has improved earnings per share by 16.7% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, NU SKIN ENTERPRISES increased its bottom line by earning $5.94 versus $3.52 in the prior year. This year, the market expects an improvement in earnings ($6.19 versus $5.94).
  • The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and the Personal Products industry average. The net income increased by 18.4% when compared to the same quarter one year prior, going from $54.28 million to $64.26 million.
  • Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. Compared to other companies in the Personal Products industry and the overall market, NU SKIN ENTERPRISES's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • You can view the full analysis from the report here: NUS Ratings Report
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