Product Launches Aid Nu Skin (NUS), Macroeconomic Hurdles Ail
Nu Skin Enterprises, Inc. NUS is on track with its Nu Vision 2025 strategy to become the world’s leading integrated beauty and wellness company. With the help of advanced technology and well-strategized product programs, management tries to capture greater market share and maintain growth momentum. However, NUS is encountering persistent macroeconomic obstacles.
Let’s delve deeper.
Product Launches on Track
The Zacks Rank #3 (Hold) company is launching innovative beauty devices, which have become an important part of its growth. In the third quarter of 2023, the company accelerated its EmpowerMe strategy across Mainland China and Korea with the rollout of the ageLOC TRMe personalized weight management system.
The company also introduced its second connected device system, ageLOC WellSpa iO, to many markets. The first holistic wellness and beauty device is aimed at restoring, revitalizing and recovering bodies. In 2022, the company introduced its first connected device, ageLOC LumiSpa, further strengthening its position as the world’s leading beauty device system brand. NUS also rolled out its Vera and Stela apps across all markets.
Apart from product launches, Nu Skin’s well-knit product strategies and customer retention programs have been driving growth in several market locations. The company is executing cost-control measures to boost its profit scope. The company acquired BeautyBio, an omnichannel and clinically proven clean skincare and beauty device brand.
Nu Vision 2025 Strategy: Key to Growth
Nu Vision 2025 strategy is based on key strategic imperatives like EmpowerMe personalized beauty and wellness strategy with connected beauty devices, affiliate-powered social commerce business model and the expansion of the digital platform. The company’s EmpowerMe strategy helps empower affiliates to attract, connect and nurture consumers. The strategy is designed to improve product consumption, attract new customers and affiliates and grow recurring revenues while increasing lifetime value.
Nu Skin is on track with core elements, including the introduction of EmpowerMe, personalized beauty and wellness strategy, the expansion of its affiliate-powered social commerce business model and the enhancement of its digital platform. Taking about advancing its digital-first ecosystem, the company’s Vera and Stela applications are doing well. NUS also began the implementation of Equinox (in June 2023), its new global e-commerce platform in North America. Management expects the new platform to create a more dynamic customer experience while eventually improving operational efficiencies.
Hurdles on the Way
Nu Skin is encountering persistent macroeconomic obstacles, which continued in the third quarter of 2023. The company’s performance was hurt by macroeconomic challenges, which impacted consumer spending and customer acquisition, mainly in the Mainland China and the Americas segments. Escalating macroeconomic pressures are hampering the company’s key markets of the company’s core business. This and unfavorable currency translations continue to remain hurdles.
All said, the upsides mentioned above are likely to offer some respite amid macroeconomic hurdles.
The stock has dropped 3.4% in the past three months against the industry’s 3.2% growth.
Solid Staple Picks
e.l.f. Beauty ELF carries a Zacks Rank #2 (Buy). ELF has a trailing four-quarter earnings surprise of 90.1%, on average. You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.
The Zacks Consensus Estimate for e.l.f. Beauty’s current financial year sales and earnings suggest growth of 84% and 62.7%, respectively, from the year-ago reported numbers.
Sysco Corporation SYY, a food and related product company, currently has a Zacks Rank #2. SYY delivered a positive earnings surprise in the last two quarters.
The Zacks Consensus Estimate for Sysco’s current fiscal year sales and earnings suggests growth of 5.2% and almost 8%, respectively, from the corresponding year-ago reported figure.
Nomad Foods NOMD, currently carries a Zacks Rank #2, manufactures and distributes frozen foods. NOMD has a trailing four-quarter earnings surprise of 7.7%, on average.
The Zacks Consensus Estimate for Nomad Foods’ current financial-year sales suggests growth of 6.6% from the prior-year reported number. However, earnings estimates suggest a year-over-year decline of 2.3%.
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