Research from Water Tower Research, Water Tower Research

Water Tower Research

Research from Water Tower Research

Water Tower Research is a leading equity research firm that provides research on micro, small and mid cap companies.

Water Tower Research was founded by Wall Street veterans after witnessing a fundamental shift in the investment research industry with the result being a declining knowledge base among investors, a lack of awareness and a shrinking pool of fundamental research being conducted on companies across the small-cap and micro-cap spectrum. The same issues are now increasingly occurring in the mid-cap space. This sea change within the investment community is impacting not only the companies themselves but also current shareholders and potential investors. With significantly less active sell-side sponsorship by Wall Street, a substantial information gap has developed between companies and various constituents in the financial community. The net result is fewer channels for insight and information to flow between companies and investors.

Equity Research Firm

Thematic (Sector/Industry)

<ul><li>While our potential universe includes a broad range of branded consumer companies across the market capitalization, one corner of that universe that we have done a lot of work on over the years involves those companies utilizing a direct selling business model, which deploys a sales force of independent contractors to get their products in the hands of consumers.</li><li>The top trend we are monitoring for 2025 is the impact that the burgeoning market for GLP-1 drugs has on the weight loss stocks.</li><li>Two pure-play weight- loss names we monitor, MED and WW, have already been severely affected by the disruption caused by the GLP-1 drugs and have been on the defensive in recent years.</li></ul>

While our potential universe includes a broad range of branded consumer companies across the market capitalization, one corner of that universe that we have done a lot of work on over the years involves those companies utilizing a direct selling business model, which deploys a sales force of independent contractors to get their products in the hands of consumers.The top trend we are monitoring for 2025 is the impact that the burgeoning market for GLP-1 drugs has on the weight loss stocks.Two pure-play weight- loss names we monitor, MED and WW, have already been severely affected by the disruption caused by the GLP-1 drugs and have been on the defensive in recent years.

2025 Outlook: Focus Is on Top Line - November 13, 2024

Equity Bottom-Up

<ul><li>LFVN reported 1QFY25 ongoing EPS of $0.15 versus $0.13 in 1QFY24, up 15.4% and in line with our forecast.</li><li>As has been the case recently, sales were below expectations, but that was made up for with better-than- expected margins.</li><li>1QFY25 sales were $47.2 million, a decline of 8.1% Y/Y, and below our forecast of $49.8 million, down 3.0% Y/Y. </li></ul>

LFVN reported 1QFY25 ongoing EPS of $0.15 versus $0.13 in 1QFY24, up 15.4% and in line with our forecast.As has been the case recently, sales were below expectations, but that was made up for with better-than- expected margins.1QFY25 sales were $47.2 million, a decline of 8.1% Y/Y, and below our forecast of $49.8 million, down 3.0% Y/Y. 

LifeVantage Corporation - 1QFY25 EPS in Line on Better Margins

<ul><li>LFVN reported 4QFY24 ongoing EPS of $0.14 versus $0.17 in 4QFY23, down 17.6%, and below our $0.21 estimate.</li><li>4QFY24 sales were $48.9 million, down 9.8%, which was below our forecast of a 6.0% decline to $51.0 million.</li><li>Local currency sales declined 8.0%, more than our forecast of a decline of 4.6%. </li></ul>

LFVN reported 4QFY24 ongoing EPS of $0.14 versus $0.17 in 4QFY23, down 17.6%, and below our $0.21 estimate.4QFY24 sales were $48.9 million, down 9.8%, which was below our forecast of a 6.0% decline to $51.0 million.Local currency sales declined 8.0%, more than our forecast of a decline of 4.6%. 

LifeVantage Corporation - Top-Line Headwinds Persist; Modestly Adjusting Estimates

<ul><li>LFVN reports its 4QFY24 results on Wednesday, August 28, after market close. </li><li>We are not changing our forecasts. Our detailed earnings models are below.</li><li>We are looking for recent trends to continue. Sales have been challenged all year, with the company bringing down its FY24 sales outlook as the fiscal year progressed, while keeping its adjusted EBITDA forecast the same, as margins have been better than originally expected.</li></ul>

LFVN reports its 4QFY24 results on Wednesday, August 28, after market close. We are not changing our forecasts. Our detailed earnings models are below.We are looking for recent trends to continue. Sales have been challenged all year, with the company bringing down its FY24 sales outlook as the fiscal year progressed, while keeping its adjusted EBITDA forecast the same, as margins have been better than originally expected.

LifeVantage Corporation - (LFVN) 4QFY24 Results Due Next Week

<ul><li>Many of the companies that participated in our recent Consumer Products Virtual Investor Conference have been working hard in righting the ship following the post- pandemic hangover that a lot of consumer names have suffered through.</li><li>There were several new management teams with new strategies, and a lot of talk about inflection points.</li><li>Vera Bradley’s CEO, CFO, and CMO have each been there for less than two years, and the company is about to roll out its Project Restoration strategic initiatives next month, which management believes will take the company into the third <span style="font-size: var(--content-font-size);">major stage of its lifecycle.</span></li></ul>

Many of the companies that participated in our recent Consumer Products Virtual Investor Conference have been working hard in righting the ship following the post- pandemic hangover that a lot of consumer names have suffered through.There were several new management teams with new strategies, and a lot of talk about inflection points.Vera Bradley’s CEO, CFO, and CMO have each been there for less than two years, and the company is about to roll out its Project Restoration strategic initiatives next month, which management believes will take the company into the third major stage of its lifecycle.

Consumer Products Conference Recap - June 20, 2024

United States

Lifevantage Corporation is a health and nutrition company that develops dietary supplements. The Company produces nutritional products that are intended to combat oxidative stress to support brain, eye, and joint function, as well as skin canine products.

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Lifevantage (LFVN US)

2025 Outlook: Focus Is on Top Line - November 13, 2024

The top trend we are monitoring for 2025 is the impact that the burgeoning market for GLP-1 drugs has on the weight loss stocks.

Water Tower Research

LifeVantage Corporation - 1QFY25 EPS in Line on Better Margins

LFVN reported 1QFY25 ongoing EPS of $0.15 versus $0.13 in 1QFY24, up 15.4% and in line with our forecast. As has been the case recently, sales were...

Water Tower Research

LifeVantage Corporation - Top-Line Headwinds Persist; Modestly Adjusting Estimates

4QFY24 sales were $48.9 million, down 9.8%, which was below our forecast of a 6.0% decline to $51.0 million. Local currency sales declined 8.0%,...

Water Tower Research

LifeVantage Corporation - (LFVN) 4QFY24 Results Due Next Week

LFVN reports its 4QFY24 results on Wednesday, August 28, after market close. We are not changing our forecasts. Our detailed earnings models are...

Water Tower Research

Consumer Products Conference Recap - June 20, 2024

Many of the companies that participated in our recent Consumer Products Virtual Investor Conference have been working hard in righting the ship...

Water Tower Research

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