Read Why This Analyst Is Bullish On Beachbody & Helen Of Troy

  • DA Davidson analyst Linda Bolton Weiser reiterated a Buy rating on the shares of Beachbody Company Inc BODY.
  • The company issued a press release reaffirming its 4Q22 guidance for revenue of $140 million - $150 million.
  • In the analyst's model, the EBITDA loss in 2022 estimate is narrowed to $(37) million versus $(86) million in 2021.
  • During a chat with the analyst, the CFO did say the company is aiming for positive EBITDA in 2023E.
  • Feedback from the Coaches was that there was too much complexity in the offerings and that the workout content release schedule was too crowded in 2022, the analyst said.
  • Management has created a standardized model, where Coaches offer clients a 3-week workout regimen, followed by one week off, the analyst added.
  • The annual subscription fee for all content is now $179, including the BOD catalog and BODi.
  • Previously, Coaches would sell BOD for $119 and then try to trade up clients to add the premium BODi for an additional $20/month.
  • The analyst said that management prioritizes revenue and cash flow generation over subscriber growth.
  • Linda Bolton Weiser also reiterated a Buy rating on Helen Of Troy Limited HELE.
  • The analyst is impressed with new COO Noel Geoffroy, who will be leading the Project Pegasus initiative.
  • COO Noel Geoffroy and CEO Julien Mininberg are very committed to driving operating margin to higher than previous peak of 16.0% in FY22, the analyst added.
  • The analyst believes FY24 guidance for organic sales and operating margin could be ranges of modestly down to slightly up Y/Y.
  • The analyst believes the free cash flow estimate of $153 million is realistic.
  • It's still unclear when retailer inventory will bottom, but consumption patterns are less bad, and inventory is okay in some places, specified the analyst.
  • Also ReadHelen Of Troy's Q3 Highlights: Earnings Beat, 10.6% Sales Decline, Job Cuts & More
  • Price Action: BODY shares are trading higher by 1.20% at $0.6735 and HELE is down 0.51% at $110.71 on the last check Thursday.
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