- By Mrinalini Chaudhuri
Nu Skin Enterprises (NUS) is a $2 billion direct selling company that markets premium quality personal care, nutrition and technology products through a global network of approximately 1 million Actives and Sales Leaders.
Founded more than 30 years ago, Nu Skin Enterprises develops and distributes innovative consumer products, offering a comprehensive line of premium-quality beauty and wellness solutions in more than 50 markets worldwide. The company builds upon its scientific expertise in both skin care and nutrition to continually develop innovative product brands that include the Nu Skin personal care brand, the Pharmanex nutrition brand, and most recently, the ageLOC anti-aging brand.
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The intrinsic value of NUS
The company recently reported second quarter results and updated its revenue guidance. It beats on revenue and increased its EPS during the quarter. The company garnered huge revenues from the promotional events in South Asia/Pacific and Greater China. The company witnessed good sales, driven mostly by the promotional product launches.
Second quarter results
The company's operating margin improved to 13.3% in the current quarter, which was 12.8% in the prior-year quarter.
Gross margin for the quarter was 78.7%, which was 80.3% in the prior-year quarter.
Selling expenses as a percentage of revenue were 41.4% during the quarter.
Share repurchases
The company repurchased $4.3 million of its outstanding shares, with $422.7 million remaining in the authorized share repurchase plan at the end of the quarter.
Dividend
The company declared a quarterly dividend of 35.5 cents per share, which will be paid on Sept. 14 to stockholders of record on Aug. 26.
Positive attributes of the quarter:
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Strong balance sheet.
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Product launches.
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Sales growth.
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Positive cash flow from operations.
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Continued improvements in inventory balance.
Expectations
| Third Quarter | Full Year | |
| Revenue guidance | To be between $2.2 billion to $2.24 billion | |
| Revenue | To be between $560 million to $580 million | |
| EPS | To be between 80 cents to 84 cents | To be between $2.44 to $2.54, or $2.80 to $2.90 when excluding a 36 cent per share non-cash Japan customs charge taken in the first quarter |
The company is committed to returning to local currency revenue growth. Irrespective of the fact that foreign currency trends will continue to be a headwind throughout the year, the company is focused on renewing its growth in China. With a strong pipeline of products, it is investing constantly in its research and development.