NTRI back in action

About 3 weeks ago Nutrisystems (NTRI) was expected to earn $0.17 EPS for the 4th quarter on revenues of $62.5M. Then NTRI announced that they would hit $0.16 on higher revenues of ~$69M.
The stock sank from $50 into a death spiral that had them as low as $36 yesterday.

SURPRISE!
NTRI announced 4th quarter results yesterday
Sales: $69.6M
Earnings: $0.17 EPS

So in 3 weeks, NTRI fell from $50 because…..it exceeded sales expectations.
Over 25% of their value was wiped out until yesterday because of what I believe to be a young company mishandling Wall Street Analysts. They should have shut up and just beat expectations and let the stock continue its rise.
We bought in at ~$50 and kept the faith even as it hit $36 yesterday. It's back to $43 today, but we are still down ~15%. Because they flubbed the situation.

Here’s the even better news:
For Q1, NTRI expects sales to surge to ~$122M+. That’s almost doubling sequentially! And it’s 10% higher than analyst expectations.
For 2006, they expect $415M+, almost double 2005. That’s inline with expectations.

I expect NTRI analysts to increase expectations and raise stock price expectations.

Several people contacted me and bought in at ~$41. Good for you – the stock is now $43+ and that’s a 5% gain in just 2 weeks.

Forward looking: assuming that NTRI is correct and that they will hit $0.40 this quarter, that will make their P/E ~48. Not very high for a company doubling its business sequentially and Y/Y. Google has a much higher P/E with a much lower growth rate, but that’s a story for another day.