In July, 2005, when China banned direct-sellers from doing business there without a license, Nu Skin Enterprises (NUS ) (NUS) got clobbered: Sales of its skin-care and nutritional products, which had boomed for three years in China, plunged in just weeks from $101 million to $80 million. And its stock dived from 26 to 15. It has edged up to 18.14 since China issued Nu Skin a license on July 30, 2006. Rodney Hathaway of Heartland Advisors, which owns shares, bought in when the stock fell. He sees Nu Skin sales in China, through its one-to-one contact with customers, ramping up again. He figures sales will hit $500 million in three to five years. His 12-month target for the stock: 28. Douglas Lane of Avondale Partners expects the tide to turn as business speeds up again in China. He predicts earnings of 75 cents a share in 2006 on sales of $1.10 billion and $1 in 2007 on $1.15 billion, down from $1.04 on $1.18 billion in 2005.
Note: Unless otherwise noted, neither the sources cited in Inside Wall Street nor their firms hold positions in the stocks under discussion. Similarly, they have no investment banking or other financial relationships with them.