What Oprah's board exit means for WW International

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Shares of WW International (WW), known as Weight Watchers, fell after Oprah Winfrey announced she would not seek reelection to the company's board. Winfrey cited her desire to avoid conflicts with her own use of the weight loss drug Ozempic.

Despite this, D.A. Davidson's Linda Bolton Weiser reiterated her bullish view on Yahoo Finance Live. She notes Oprah has been "reducing her stake" for some time, and believes the company's operating results outweigh Winfrey's departure.

Weiser claims her price target remains the same given Weight Watchers' "turnaround." She sees stabilization in the core business with growing users and clinical offerings.

For more expert insight and the latest market action, click here to watch this full episode of Yahoo Finance Live.

Editor's note: This article was written by Angel Smith

Video Transcript

AKIKO FUJITA: WW International, better known as Weight Watchers, shares tumbling today. This comes after Oprah says she will not stand for re-election on the company's board in May. The health management company reporting fourth quarter revenue down 7.6% compared to a year ago. For more on this, let's bring in Linda Bolton Weiser, DA Davidson managing director.

Linda, it's good to talk to you. The context or the background to all, of course, Oprah has acknowledged that she has been able to lose a lot of weight using those GLP-1 drugs. And you've got still what looks to be a very bullish price target on Weight Watchers. You're changing that target at all in light of what's played out today?

LINDA BOLTON WEISER: No, not at all. In fact, I raised my operating profit estimate for 2024 by 20%. And I kept my 2025 EPS estimate the same at $0.60 a share. So really, my price target stays the same. I do think that there's a lot of media attention today being put on the whole Oprah issue. But she's been reducing her stake in the company for quite a while now and distancing herself.

And actually, the press release said that part of the reason she is stepping off the board and donating her remaining stake is that she doesn't want there to be the appearance of a conflict of interest as she talks about her use of the GLP-1 weight loss drugs. So I think there's a lot of attention being put on that and not enough attention being put on the operating results of the company, which are actually improving.

AKIKO FUJITA: So the Oprah decline, we should say, that may be a little oversold. But there have been real concerns here about Weight Watchers and its ability to compete in the market in light of the surge that we have seen in demand for GLP-1 drugs. What do you think investors are missing?