Weight Watchers Surges After Boosting Profit ForecastLeslie Patton
Weight Watchers International Inc., the weight-control program provider endorsed by celebrities such as Jessica Simpson, rose the most in more than three years after boosting its 2014 profit forecast.
The shares climbed 20 percent to $23.71 at the close in New York for the biggest one-day gain since February 2011. Weight Watchers had slid 40 percent this year through yesterday, dragged down by concerns about declining sales and earnings.
Profit per share this year will be $1.45 to $1.70, up from a previous forecast of $1.30 to $1.60, the New York-based company said yesterday in a statement. The average of seven analysts’ estimates compiled by Bloomberg was $1.40.
Chief Executive Officer Jim Chambers has been working to transform Weight Watchers and stem the loss of customers to free mobile applications that track calories. The company’s new two-week Simple Start program, promoted by Simpson, features a mobile app, helping the company fend off technology upstarts.
“We are encouraged by the progress we are making on our transformation plan, but there is still a great deal of work to do,” Chambers said in the statement.
Weight Watchers’ previous earnings report, delivered in February, had raised concerns the company was struggling to adjust to the Internet era. The stock had plunged 28 percent on Feb. 14 after Weight Watchers posted the results.