What Happened?
Shares of wellness products company Nature’s Sunshine (NASDAQ: NATR) jumped 11.9% in the morning session after the company reported strong second-quarter results that beat analyst expectations and raised its full-year financial forecast. The wellness products company announced its net sales grew 4% year-over-year to $114.8 million. Profits experienced a significant jump, as net income more than quadrupled to $5.3 million compared to the same period last year. The company's adjusted EBITDA, a key measure of profitability, also increased by 8%. Bolstered by this performance, Nature's Sunshine lifted its full-year revenue guidance to a range of $460 million to $475 million. Management credited strong sales in Japan and Central Europe, alongside accelerated growth in its digital business, for the robust quarter.
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What Is The Market Telling Us
Nature's Sunshine’s shares are quite volatile and have had 19 moves greater than 5% over the last year. But moves this big are rare even for Nature's Sunshine and indicate this news significantly impacted the market’s perception of the business.
The biggest move we wrote about over the last year was about 1 month ago when the stock dropped 8.5% on the news that the company announced the pricing of a secondary stock offering by a major shareholder.
The offering involves major shareholder Fosun Pharma USA selling up to 2.85 million shares at a price of $12.00 per share. The stock is trading down to align with the offering price, which represents a significant discount to its previous closing price. While the company itself is not selling any new shares and will not receive any proceeds, the large block of stock hitting the market is creating selling pressure. Nature's Sunshine did note that it may buy back up to $15 million worth of shares from the offering as part of its existing repurchase program, which could help absorb some of the supply.
Nature's Sunshine is up 7.6% since the beginning of the year, but at $15.67 per share, it is still trading 10.1% below its 52-week high of $17.43 from November 2024. Investors who bought $1,000 worth of Nature's Sunshine’s shares 5 years ago would now be looking at an investment worth $1,510.
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