Connect with us

Business

Oprah Needs New Year’s Resolutions to Stick

Published

on

Each new year begins full of hope for this company and its clients, but few were as disappointing as 2021.

WW International,


WW 0.30%

the dieting specialist formerly known as Weight Watchers, had millions of potential new customers a year ago who had packed on their “Covid 15” earlier in the pandemic. Vaccine rollouts meant the company’s coaches would once again be able to meet their clients face-to-face. And, as is typical, it saw a January surge in membership in line with New Year’s resolutions.

But WW’s rebound yo-yoed, and its shares lost a third of their value during a banner year for stocks generally and reopening plays in particular. By contrast, shares of gym chain

Planet Fitness,

which was set to benefit from many of the same trends, hit a record high.

The last time sentiment was so poor about WW was back in 2015 when entertainment mogul

Oprah Winfrey

rode to the rescue, buying 10% of the company’s shares and receiving options for even more. The stock jumped by as much as 1,600% over the next few years.

By the end of last year’s third quarter, though, WW was down to 4.5 million subscribers, compared with 4.7 million a year earlier and 5 million at the end of 2021’s first quarter. Quarterly revenue had dropped by 8.5% year-over-year.

If past trends hold—the company loses about 13% of its subscribers between the first and fourth quarters as resolutions slip—it will end the year with even fewer members. Earnings guidance was revised to between 80 and 90 cents a share for the full year, compared with analysts’ consensus expectations of $2.21 at the start of the year, according to FactSet.

A financial charge for extinguishing debt took a toll, but so have fundamentals. WW has been shifting away from in-person toward digital and virtual offerings with many new customers choosing a “mid-priced” tier. And, while weight-loss certainly is on many people’s minds, and dieting is widely acknowledged to trump exercise, the psychology of the pandemic seems to have made sacrifice even less attractive than usual. People simply feel like treating themselves.

Ms. Winfrey is still the largest individual shareholder, with 1.57% of the stock—about four times what Chief Executive Officer

Mindy Grossman

owns—but a fraction of her former stake. The company has brought in a newer “ambassador,” late-night talk show host

James Corden,

to help. He has yet to work miracles.

As with weight loss, though, sometimes less is more. For example, while WW touts its revamped “food innovation program,” sales of meals have been falling fast and the effect has been a boost in margins. It is also cutting costs by allowing leases to expire for some physical branches. But digital sales are more profitable and helped boost the third quarter’s adjusted gross margin to 62.3% from 59.6%.

SHARE YOUR THOUGHTS

Have you or someone you know found a particularly helpful weight-loss program? If so, what is the secret to its success? Join the conversation below.

It might be prudent to wait for full-year results likely out in late February, which could be a doozy, but a slimmer profile could soon attract bargain hunters for WW’s stock. It now fetches less than 10 times forward earnings, a 40% discount to its five-year average. Once the personal indulgence phase of the pandemic passes, the need for weight management will be even greater.

Unlike in 2015, WW now has both an award-winning diet and an award-winning app. One obvious concern is that there is now a plethora of competing digital-health offerings. What those don’t offer, though—and what might be especially appealing once the Covid-19 pandemic finally loosens its grip—is the human element and long track record of WW’s services.

It might not happen in January, but the new year could bring a resolution to WW’s struggles.

Write to Spencer Jakab at spencer.jakab@wsj.com

Copyright ©2022 Dow Jones & Company, Inc. All Rights Reserved. 87990cbe856818d5eddac44c7b1cdeb8

Source link

Continue Reading
Click to comment

Leave a Reply

Your email address will not be published.

Business

Teladoc Tumbled 38% After Big First-Quarter Loss. Is It Just a Pandemic Play?

Published

on

Text size

Source link

Continue Reading

Business

After pandemic drop, Canada’s detention of immigrants rises again By Reuters

Published

on


© Reuters. FILE PHOTO: Two closed Canadian border checkpoints are seen after it was announced that the border would close to “non-essential traffic” to combat the spread of novel coronavirus disease (COVID-19) at the U.S.-Canada border crossing at the Thousand Isla

By Anna Mehler Paperny

TORONTO (Reuters) – Canada is locking up more people in immigration detention without charge after the numbers fell during the pandemic, government data obtained by Reuters shows.

Authorities cite an overall rise in foreign travelers amid easing restrictions but lawyers say their detained clients came to Canada years ago.

Canada held 206 people in immigration detention as of March 1, 2022 – a 28% increase compared with March 1 of the previous year. Immigration detainees have not been charged with crimes in Canada and 68% of detainees as of March 1 were locked up because Canada Border Services Agency (CBSA) fears they are “unlikely to appear” at an immigration hearing, according to the data.

The rise puts Canada at odds with Amnesty International and other human rights groups that have urged Ottawa to end its use of indefinite immigration detention, noting CBSA has used factors such as a person’s mental illness as reason to detain them.

A CBSA spokesperson told Reuters that “when the number of entries (to Canada) goes up, an increase in detention is to be expected.” CBSA has said in the past it uses detention as a last resort.

A lawyer told Reuters her detained clients have been in Canada for years.

In the United Kingdom, too, immigration detention levels rose last year after dropping earlier in the pandemic, according to government statistics. Unlike Canada, the United States and Australia, European Union member states have limits on immigration detention and those limits cannot exceed six months.

The rise in detentions puts people at risk of contracting COVID-19 in harsh congregate settings, refugee lawyers say.

Julia Sande, Human Rights Law and Policy Campaigner with Amnesty, called the increase in detentions “disappointing but not surprising,” although she was reluctant to draw conclusions from limited data.

The number of immigration detainees in Canada dropped early in the pandemic, from a daily average of 301 in the fourth quarter (January through March) of 2019-20 to 126 in the first quarter (April through June) of 2020-21.

FEW NO-SHOWS AS DETENTIONS DROPPED

Detaining fewer people did not result in a significant increase in no-shows at immigration hearings – the most common reason for detention, according to Immigration and Refugee Board data.

The average number of no-shows as a percentage of admissibility hearings was about 5.5% in 2021, according to that data, compared to about 5.9% in 2019.

No-shows rose as high as 16% in October 2020, but a spokesperson for the Immigration and Refugee Board said this was due to people not receiving notifications when their hearings resumed after a pause in the pandemic.

Refugee lawyer Andrew Brouwer said the decline in detention earlier in the pandemic shows Canada does not need to lock up as many non-citizens.

“We didn’t see a bunch of no-shows. We didn’t see the sky fall … It for sure shows that the system can operate without throwing people in jail,” Brouwer said.

He added that detainees face harsh pandemic conditions in provincial jails – including extended lockdowns, sometimes with three people in a cell for 23 hours a day.

Refugee lawyer Swathi Sekhar said CBSA officials and the Immigration and Refugee Board members reviewing detentions took the risk of COVID-19 into account when deciding whether someone should be detained earlier in the pandemic but are doing so less now.

“Their position is that COVID is not a factor that should weigh in favor of release,” she said.

“We also see very, very perverse findings … [decision-makers] outright saying that individuals are going to be safer in jail.”

The Immigration and Refugee Board did not immediately respond to a Reuters request for comment.

Source link

Continue Reading

Business

Nasdaq futures rise as market attempts comeback from April sell-off, Meta shares soar

Published

on

Stock futures rose in overnight trading as the market shook off the April sell-off and investors reacted positively to earnings from Meta Platforms.

Futures on the Dow Jones Industrial Average added 70 points or 0.2%. S&P 500 futures gained 0.7% and Nasdaq 100 futures jumped 1.2%.

The moves came as shares of Meta surged more than 18% after hours following a beat on earnings but a miss on revenue, a sign that investors may see signs of relief in the beaten-up tech sector. Shares were down 48% on the year heading into the results.

Meanwhile, shares of Qualcomm gained 5.6% in extended trading on the back of strong earnings while PayPal rose 5% despite issuing weak guidance for the second quarter.

“I think a lot of people want to believe that earnings are going to pull us out of this, but earnings are not what got us into this,” SoFi’s Liz Young told CNBC’s “Closing Bell: Overtime” on Wednesday. “… But the reality is there are so many macro headwinds still in front of us in the next 60 days that the market is just hard to impress.”

The after-hour activity followed a volatile regular trading session that saw the Nasdaq Composite stoop to its lowest level in 2022, as stocks looked to bounce back from a tech-led April sell-off. The index is down more than 12% since the start of April.

In Wednesday’s regular trading, the tech-heavy Nasdaq ended at 12,488.93, after rising to 1.7% at session highs. The Dow Jones Industrial Average rose 61.75 points, or 0.2%, to 33,301.93 propped up by gains from Visa and Microsoft, while the S&P 500 added 0.2% to 4,183.96.

Investors await big tech earnings on Thursday from Apple, Amazon and Twitter, along with results from Robinhood. Jobless claims are also due out Thursday.

Source link

Continue Reading

Trending