The expected turnaround has led to some strength in the stock. The last earnings also provided support. It has risen by more than 30% since mid April. The volumes have not been too great, but it has managed to cross crucial hurdles over the last few weeks. The 52 week high of $11.75 remains far away, but the way it is moving, that could be the target over the next few months. For that the earnings have to support, and the news flow has to remain positive. Increased demand for its new offering, the 5-Day Jumpstart Weight Loss Kit, has made the company ramp up production. The strategy of selling through more Walmart outlets is also working. The weight loss market, including the diet segment is expected to grow by 36% from $265 billion to $361 billion in next 4 years. North America remains the biggest market, but the growth is likely to come more from the Asian markets. The meal plans from NutriSystem are being offered in different ways, and the company is looking towards newer offerings to improve its product line. The focus is on profitability and revenue growth. Other companies in the market work with supplements or proprietary natural ingredients. A new product, a vitamin Nicotinamide Riboside, is being offered by Chromadex Corporation (CDXC) which helps in weight loss and diabetes management. NutriSystems can remain open to innovative offerings being made in the market for inclusion in its meal plans. The next quarter earnings will be crucial for maintaining the uptrend. As soon as there is more confidence that the company will turnaround on a full year basis, the momentum will increase on the upside. If the company is able to deliver on its promise, then the investors will surely be rewarded with great returns over the next few quarters.
Nice post. I would add to the picture for longs the real possibility of a short squeeze. Too few share for sale, IMO, especially with yesterday's positive news update. This combined with a sizable short position could ignite a major rally in the share price. Of course, the short position may be sitting on enormous gains and their concern to cover might be negligible. The last point I would add is the prospect for analyst upgrades. They are coming.