WW - I Worry That WW International Formerly Weight Watchers May Not Survive

2024-03-14 06:28:43 ET

Summary

• WW International's massive debt, ineffective operating model, and competition from weight-loss drugs could lead to its downfall.
• S&P downgraded the company's debt rating to CCC+ from B- on March 11.
• According to a reporter's tweet on March 13, lenders are hiring lawyers for debt negotiations.

Investors owning WW International ( WW ), formerly Weight Watchers, stock have lost a ton of weight (money) over the last few years and may soon be down to just skin and bones. There are three major reasons that could collectively lead to the demise of Weight Watchers: 1) they have way too much debt; 2) their operating business model no longer works; 3) more and more overweight people are taking new drugs to reduce weight. Now, there was a report on March 13 that lenders are hiring lawyers. Oprah Winfrey leaving the board of directors is another strong indicator that it is over. In addition, S&P lowered the company debt rating from B- to CCC+ with a negative outlook on Mar 11. I consider WW stock a "sell"....

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