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Here's Why Weight Watchers (WTW) Stock Soared 25% Today

Weight Watchers International WTW soared 25% in morning trading on Friday after the diet company reported better-than-expected second quarter fiscal 2017 results.

The company reported earnings of $0.67 per share, beating our consensus estimate of $0.50 per share. Weight Watchers also reported revenue of $341.7 million, representing an increase of 12% year-over-year.

Subscribers to the company’s program rose 20% year-over-year to 3.5 million. Total paid weeks also rose, with meeting paid weeks increasing 9.7% and online paid weeks increasing 22.6% year-over-year.

CEO Mindy Grossman attributes Weight Watchers’ collaboration with Oprah Winfrey as a major factor in the company’s growth. In Thursday’s earnings conference call, Grossman said, “Winfrey has certainly accelerated the company’s progress since October 2015 with high awareness of her success and happiness with the program sparking interest and excitement.”

Winfrey bought a 10% stake of Weight Watchers in 2015. Since then, the stock has gone from $6 per share to closing at $33.08 on Thursday. “I’m personally looking forward to partnering with her as we transform the brand and business,” Grossman said

WTW remains a Zacks Rank #3 (Hold), with a VGM score of ‘A.’ The company raised its 2017 guidance to a range of $1.57 to $1.67 from the prior guidance of $1.40 to $1.50.

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