UPDATE: Barclays Downgrades Weight Watchers, Cites Slimming Revenues

Barclays released a research note Tuesday in which the firm downgraded

from Equal-Weight to Underweight and lowered the price target from $31 to $15, perhaps marking the first time the company is unhappy about weight loss. Barclays' Meredith Adler summarized the firms opinion stating, "We think the right steps are being taken but the outcome is highly uncertain. Even management has said that a rise in new members is not likely until fiscal year 2015 and in revenues not until fiscal year 2016." Adler continued, "We now show fiscal year EBITDA dropping by approximately 40 percent, while leverage rises to 7.4x. The company's term debt has no covenants, though the interest rate rises if its credit rating drops, which even Weight Watchers thinks is likely." Wrapping things up Alder concluded, "We do not see issues with either leverage or liquidity this year, but find it hard to see why the stock should trade much above our new price target of $15." At last check, Weight Watchers was down almost 4 percent at $21.25