Nu Skin (NUS) is on the Hedgeye Consumer Staples Best Ideas list as a SHORT.
Today, Barron’s ran an article on VitaMeal raising some of the concerns that we have, but the article lacks many of the details around VitaMeal and the implication for NUS.
It's important to remember that NUS is currently under investigation by the SEC. Our call focuses on the process, ethics and execution of getting the needy children the food, which is questionable at best. If the SEC were to expand the scope of its investigation into NUS's business practices it would be financially devastating to the company.
Our call on Wednesday, November 11th, will cover the following topics that were not covered in the Barron's article
- Quarterly impact on NUS's sales and EPS since Q1 2012
- How NUS's multiple charities work jointly to sell VitaMeal
- An example of how distributors may be deceiving consumers (see graphic below)
- Names of the people and organizations in Malawi that are tied to NUS
- Why VitaMeal could increase the scope of the SEC investigation into NUS
- The financial condition of NUS and why this scandal could cripple the company
- And more...
The Barrons article also referenced a call, General Counsel Noah Bryson, had with VitaMeal distributors in October. We have a transcript of that call available if you would like to read it. Its quite entertaining.
Call with questions or contact if you would like to listen to the call.