After falling in early trading Wednesday, Nu Skin Enterprises, Inc. NUS spiked midday amid the release of a Deutsche Bank note regarding the company’s new $375 million credit facility.
Analyst Bill Schmitz Jr. clarified that “contrary to some reports in the press, the company is not restricted from making dividend payments on equity.”
According to the note, a “portion of the proceeds was used to pay other outstanding debt, with the remainder available for working capital and other corporate purposes. Management commented on the release that the facility provides greater flexibility to return value to shareholders."
Schmidt commented that with “the company able to finally refinance its debt and operating cash flow turning positive according to our model in 3Q, we believe the worst is behind the company...with recent channel checks suggesting recruitment in China is accelerating after a very slow start, careful to note that it will take considerable time to return the business to 2013 levels.”
The firm maintained a Buy rating and $70 price target.
Nu Skin Enterprises, Inc., recently traded at $45.28, down 7.54 percent.
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