Weight management specialist Weight Watchers International, Inc.
) late Tuesday posted better-than-expected third quarter earnings
and boosted its full-year outlook, but shares plunged in
aftermarket trading on concerns about the company's higher
marketing and internal spending.
The New York-based company reported third quarter net income of
$1.09 per share on revenue of $428.4 million. On average, Wall
Street analysts expected a much smaller profit of 94 cents per
share, on lower revenue of $411 million.
Looking ahead, the company said it now expects full-year
earnings of $4.05 to $4.10 per share for the year, marking the
third time in 2011 the company has raised its forecast. Analysts
currently are looking for earnings of $3.98 per share for the
On a sour note, WTW noted that marketing expenses jumped 20% in
the lastest quarterm while administrative rose 14%. CEO David
Kirchoff commented, "As we enter 2012, we remain cautious about the
uncertain economy and … assume competition from other commercial
weight loss competitors will be robust."
Weight Watchers shares fell $6.84, or -9.5%, in premarket
The Bottom Line
Shares of Weight Watchers (
) have a .97% dividend yield, based on last night's closing stock
price of $71.84. The stock has technical support in the $60-$63
price area. If the shares can rebound, we see overhead resistance
around the $76-$80 price levels.
Weight Watchers International, Inc. (
) is not recommended at this time, holding a Dividend.com DARS™
Rating of 3.2 out of 5 stars.
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