Weight Watchers International (WW) PT Raised to $33 at DA Davidson

DA Davidson analyst Linda Bolton Weiser raised the price target on Weight Watchers International (NASDAQ: WW) to $33.00 (from $32.00) while maintaining a Buy rating.

The analyst commented, "WW reported a solid profit beat as gross margin was up strongly due to the shift to digital. Subs were 4.7M, +5% Y/Y, slightly below our 4.8M estimate, but revenue was roughly in line with consensus. The digital shift will be a $50M (4%) top-line headwind in 2021, but we are raising our EPS estimates on higher gross margin. Due to the lower top-line growth, we are reducing our target P/E to 13x from 17x, but raising our PT to $33 from $32, based on 13x 2022E EPS of $2.50 (a new estimate). The stock is attractively valued, given our outlook for profit growth in 2021 and improving financial leverage - we are maintaining our BUY rating."

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