What Happened?
Shares of wellness products company Nature’s Sunshine (NASDAQ:NATR) fell 8.5% in the afternoon session after the company announced the pricing of a secondary stock offering by a major shareholder. The offering involves major shareholder Fosun Pharma USA selling up to 2.85 million shares at a price of $12.00 per share.
The stock is trading down to align with the offering price, which represents a significant discount to its previous closing price. While the company itself is not selling any new shares and will not receive any proceeds, the large block of stock hitting the market is creating selling pressure.
Nature's Sunshine did note that it may buy back up to $15 million worth of shares from the offering as part of its existing repurchase program, which could help absorb some of the supply.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy Nature's Sunshine? Access our full analysis report here, it’s free.
What The Market Is Telling Us
Nature's Sunshine’s shares are quite volatile and have had 18 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 24 days ago when the stock dropped 7.2% on the news that CEO Terrence Moorehead, announced his decision to step down from his role. The board also announced the search for his successor, and Moorehead will remain in his role until a new CEO is appointed. This interim period introduced leadership uncertainty, something the market generally dislikes.
Nature's Sunshine is down 5.5% since the beginning of the year, and at $13.76 per share, it is trading 21.1% below its 52-week high of $17.43 from November 2024. Investors who bought $1,000 worth of Nature's Sunshine’s shares 5 years ago would now be looking at an investment worth $1,735.
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