NEW YORK (TheStreet) -- Shares of Weight Watchers International (WTW) are dropping 2.19% to $4.91 on Friday after analysts at Credit Suisse lowered their price target to $4 from $5 and maintained their "underperform" rating.
The firm cited that shares have declined 35% since the company reported first quarter earnings in early May, and investors continue to have concerns around the company's ability to return to recruitment growth and meet debt maturities in 2016 and 2020, amidst ongoing cost-cuts.
For the first quarter 2015, the New York-based company reported revenue of $322.1 million, or loss of 9 cents per shares, compared to revenue of $327.8 million or profit of 7 cents per share in the same quarter last year.
The company was expected to report revenue of $322.5 million or loss of 19 cents per share, according to analysts polled by Thomson Reuters.
Additionally, the company has debt of about $2.3 billion and a business model that has struggled to keep up with contemporary trends as dieters' habits are changing, The Wall Street Journal reported.
The millennial generation now prefers to eat healthy and regularly exercise instead of participating in weight loss programs, the Journal noted.
Separately, TheStreet Ratings team rates WEIGHT WATCHERS INTL INC as a Sell with a ratings score of D. TheStreet Ratings Team has this to say about their recommendation:
"We rate WEIGHT WATCHERS INTL INC (WTW) a SELL. This is driven by a number of negative factors, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its feeble growth in its earnings per share, deteriorating net income, weak operating cash flow and generally disappointing historical performance in the stock itself."