Janet Jackson Aids Nutrisystem Earnings, Slightly

Tuesday saw Nutrisystem

and, in the process, announce that it lost four cents per share in the fiscal fourth quarter, which is in fact above analyst estimates of two cents per share. In addition, revenue dropped to $66.9 million from $87.9 million the previous year. Analysts had been expecting revenue of $64.4 million. According to

, NTRI also forecast a 5 to 10 cent per share loss in 1Q, while analysts expect the company to make 10 cents per share. For the FY2012, NTRI expects a profit of 45 to 55 cents per share, below estimates of 92 cents. Following the earnings, Citi released a research report on Tuesday morning saying that the Janet Jackson campaign is strong and is increasing awareness with new customers. That makes sense; Jackson is still a major star in the U.S. and her association with any company is sure to have a positive impact. According to Citi, with the Janet Jackson campaign, mgmt has seen double digit increases in the first few weeks for first time orders, a slow down given the lapping of the Rollback promo last yr (launched in 2nd/3rd wk of Jan), then increased conversion rates each week to post the best Feb since '08 for new customers. “NTRI reported 4Q EPS of -4c vs. FC of -2c and guid. of -2 to +3c. Sales were $67mm vs. FC of $64mm. EPS includes a -15c est impact from accelerated expenditures (vs. guidance of 11c) to support a new program launch in '12 and other growth initiatives. GM was at 46.6% vs. 56.5% in 4Q last yr and was impacted negatively by 150bps from clearing out inventory through Big Lots stores.” Wedbush said that revenues of $67 million exceeded its $62 million estimate. “Given the continued use of promotions to drive sales, partially offset by strong cash flow, we believe shares of NTRI should trade at a 20% discount to the peer-group average. Thus, using an EV/ 2012E EBITDA multiple of 7.5x, we generate our PT of $11.”