Usana Health Sciences shares plunge 30% as Q2 results miss forecasts and guidance is slashed
The company announced a $29 million goodwill impairment charge and revised its full-year outlook to a loss of roughly $11 million, contrasting sharply with broader market gains.
Shares of Usana Health Sciences (NYSE: USNA) fell 30% in the week following the release of its second-quarter financial results, which missed analyst estimates for both sales and earnings. The decline occurred while the broader market rallied, with the S&P 500 gaining 3.6% and the Nasdaq Composite rising 5.2% during the same period. The financial results and revised guidance were published on 4 August.
Usana reported second-quarter non-GAAP earnings of $0.07 per share on revenue of approximately $223 million. The adjusted profit per share came in $0.50 below the average analyst estimate, while revenue was roughly $12 million lower than the average forecast. The company noted that while its core nutrition segment showed signs of stabilization, this was offset by weaker performance in its Hiya and Rise segments.
In addition to the earnings miss, Usana announced a $29 million goodwill impairment charge related to its Hiya business. The company also significantly revised its full-year outlook, now predicting a loss of roughly $11 million. This represents a substantial downgrade from previous guidance, which had projected a profit between $20 million and $27 million.
Full-year sales guidance was also lowered from a range of $925 million to $1 billion to $910 million. The combination of weaker-than-expected second-quarter earnings and forward guidance suggesting persistent headwinds has led to a sharp contraction in the company's valuation.
Analysts suggest that Usana stock could remain under pressure until the company can demonstrate meaningful signs that performance is rebounding. The Motley Fool, which originally reported on the results, noted that the stock was not included in their recent list of top recommended stocks for long-term growth.
