Nu Skin Enterprises, Inc. (NYSE: NUS)

Sector: Consumer Defensive Industry: Household & Personal Products CIK: 0001021561
Market Cap 496.20 Mn
P/B 0.62
P/E 4.53
P/S 0.32
ROIC (Qtr) -1.03
Div Yield % 2.99
Rev 1y % (Qtr) -15.33
Total Debt (Qtr) 291.43 Mn
Debt/Equity (Qtr) 0.36

About

Nu Skin Enterprises, Inc., a company commonly recognized by its stock symbol NUS, operates in the direct selling channel, offering a range of premium-quality beauty and wellness solutions. The company's operations span nearly 50 global markets, with a focus on person-to-person marketing to promote its products. Nu Skin's primary brands include Nu Skin, Pharmanex, and ageLOC, which are tailored to the beauty and wellness markets. The company's main business activities revolve around the development, distribution, and sale of a comprehensive line...

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Price action

Investment thesis

Bull case

  • Healthy cash reserves of 251.79M provide 12.59x coverage of short-term debt 20M, demonstrating strong liquidity position and minimal refinancing risk.
  • Strong tangible asset base of 1.30B provides 4.45x coverage of total debt 291.43M, indicating robust asset backing and low credit risk.
  • Retained earnings of 1.85B provide full 6.81x coverage of long-term debt 271.43M, indicating strong internal capital position.
  • Robust tangible asset base of 1.30B provides 4.41x coverage of working capital 293.71M, indicating strong operational backing.
  • Cash reserves of 251.79M provide robust 0.99x coverage of current liabilities 254.44M, indicating strong short-term solvency.

Bear case

  • Operating cash flow of 89.45M barely covers its investment activities of 166.80M, with a coverage ratio of 0.54, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Operating cash flow of 89.45M provides thin coverage of dividend payments of (11.91M) with a -7.51 ratio, suggesting potential dividend sustainability issues if operational performance deteriorates.
  • Cash reserves of 251.79M provide limited coverage of acquisition spending of 193.72M, which is 1.30x, suggesting aggressive expansion might strain liquidity if market conditions deteriorate.
  • The company's operating cash flow of 89.45M shows concerning coverage of stock compensation expenses of 24.39M, with a 3.67 ratio indicating potential earnings quality issues.
  • Operating earnings of 136.02M show weak coverage of depreciation charges of 78.24M, with a 1.74 ratio indicating high capital intensity and potential reinvestment needs.

Peer comparison

Companies in the Household & Personal Products
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 PG PROCTER & GAMBLE Co 344.56 Bn 20.55 4.06 35.95 Bn
2 UL Unilever Plc 162.92 Bn 24.93 2.32 -
3 CL Colgate Palmolive Co 64.98 Bn 22.35 3.23 8.42 Bn
4 EL Estee Lauder Companies Inc 38.59 Bn -41.50 2.67 9.42 Bn
5 KMB Kimberly Clark Corp 33.56 Bn 17.05 1.86 7.30 Bn
6 KVUE Kenvue Inc. 32.45 Bn 22.64 2.16 8.97 Bn
7 CHD Church & Dwight Co Inc /De/ 20.90 Bn 26.71 3.40 2.20 Bn
8 CLX Clorox Co /De/ 12.14 Bn 15.35 1.79 3.08 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 0.38 1.45
EV to Cash from Ops. EV/CFO 6.07 8.11
EV to Debt EV to Debt 1.86 4.77
EV to EBIT EV/EBIT 3.99 14.54
EV to EBITDA EV/EBITDA 8.02 7.35
EV to Free Cash Flow [EV/FCF] EV/FCF 10.17 2.98
EV to Market Cap EV to Market Cap 1.09 -1.59
EV to Revenue EV/Rev 0.35 2.00
Price to Book Value [P/B] P/B 0.62 -7.69
Price to Earnings [P/E] P/E 4.53 16.46
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) 9.20 9.11
Dividend Payout Ratio % Div Payout % (Qtr) 10.80 12.82
Dividend per Basic Share Div per Share (Qtr) 0.24 0.92
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 22.22 11.25
Interest Coverage Int. cover (Qtr) 8.60 2.65
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) 26.90 -96.96
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 10.55 2.29
Dividend Growth (1y) % Div 1y % (Qtr) -57.89 -2.46
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 262.10 -142.06
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 214.74 -154.15
EBIT Growth (1y) % EBIT 1y % (Qtr) 270.01 -155.18
EBT Growth (1y) % EBT 1y % (Qtr) 211.38 -206.88
EPS Growth (1y) % EPS 1y % (Qtr) 206.73 -158.13
FCF Growth (1y) % FCF 1y % (Qtr) -41.20 -5.66
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) -16.46 -1.42
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 1.10 0.82
Cash Payout Ratio Cash Payout (Qtr) 0.09 0.19
Cash Ratio Cash Ratio (Qtr) 0.99 0.76
Current Ratio Curr Ratio (Qtr) 2.15 2.31
Debt to Equity Ratio Debt/Equity (Qtr) 0.36 -2.80
Interest Cover Ratio Int Coverage (Qtr) 8.60 2.65
Times Interest Earned Times Interest Earned (Qtr) 8.60 2.65
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 13.70 -32.28
EBIT Margin % EBIT Margin % (Qtr) 8.72 -37.76
EBT Margin % EBT Margin % (Qtr) 7.70 -40.89
Gross Margin % Gross Margin % (Qtr) 67.20 50.05
Net Profit Margin % Net Margin % (Qtr) 7.00 -42.94