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We initiated a short position in Weight Watchers (WTW) in our Real Time Alerts this week based on our thesis that revenue is decelerating at the company. Our thesis is comprised of three main ideas: growth trends will decelerate in Q4 and 2013, WTW will guide down on EPS and the stock is unlikely to find support in the market.

Going forward, Weight Watchers will likely guide down on EPS on its next earnings report, which takes place on November 5. Management really needs to improve outlook and help stabilize attendance or WTW will continue to head lower in the market. Our theme of #EarningsSlowing continues to build with every report coming out week after week.

WTW: Decelerating Trends  - wtw2

WTW: Decelerating Trends  - wtw1