Barrington on Nutrisystem, Rates Outperform

In a research note released Monday, Barrington Research analyst Alexander Paris Jr. initiated coverage on Nutrisystem, Inc.

with an Outperform rating and a $20 price target. The analyst stated that the highly regarded and proven company has shown that it has the ability to innovate. Furthermore, the new executives have already started to execute a turnaround plan, despite the fact that they have only been in place for a year. The company has also set its eyes on acquiring or growing its customer base, as it has put into effect improved marketing initiatives, new products and programs and customized plans. Last year, 2013, NTRI partnered with Wal-Mart to sell five-day Jumpstart weight loss kits, which represented 4.5 percent of revenue with has a projected growth rate of 50 percent in 2014. In addition, the company also launched a similar program in stores of target in the second quarter of 2014. Expanding on the marketing initiatives that NTRI is taking, the analyst stated, “Strategic messaging efforts are positioning Nutrisystem to create better value for its core consumer while addressing transition and weight management audiences.” These initiatives will attract new customers and extend the customer lifetime value. Shares of the company are up three percent today and are up four percent year-to-date.