Usana Health (USNA) Is Today's Perilous Reversal Stock

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer.

Trade-Ideas LLC identified Usana Health ( USNA) as a "perilous reversal" (up big yesterday but down big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Usana Health as such a stock due to the following factors:

  • USNA has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $17.7 million.
  • USNA has traded 53,909 shares today.
  • USNA is down 5.5% today.
  • USNA was up 20% yesterday.

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More details on USNA:

USANA Health Sciences, Inc. develops, manufactures, and sells science-based nutritional and personal care products primarily to reduce the risk of chronic degenerative disease worldwide. USNA has a PE ratio of 20.9. Currently there are no analysts that rate Usana Health a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for Usana Health has been 80,900 shares per day over the past 30 days. Usana Health has a market cap of $1.5 billion and is part of the health care sector and drugs industry. The stock has a beta of 2.01 and a short float of 18.6% with 7.56 days to cover. Shares are up 14.1% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Usana Health as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, notable return on equity, reasonable valuation levels and solid stock price performance. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results.

Highlights from the ratings report include:
  • The revenue growth came in higher than the industry average of 9.5%. Since the same quarter one year prior, revenues rose by 20.3%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • USNA has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign.
  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. When compared to other companies in the Personal Products industry and the overall market, USANA HEALTH SCIENCES INC's return on equity exceeds that of the industry average and significantly exceeds that of the S&P 500.
  • Powered by its strong earnings growth of 30.43% and other important driving factors, this stock has surged by 66.02% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, although almost any stock can fall in a broad market decline, USNA should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.

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