Pittsburgh, Pennsylvania– Second quarter downside is expected from the General Nutrition Corporation (GNC) report towards the end of the month. Based on proprietary research, significant risk is seen to the consensus Earnings Per Share (EPS) valuation of $3.06 throughout the year, and reducing the entire 2014 valuation from $0.10 to $2.80, reflecting lower comp-store expectations. However, the 2015 EPS valuation moves to $3.20.
The quantity available for sale by GNC SKUs at Amazon Marketplace was tracked continuously. It was used as a promotional activity barometer. Analysts were able to communicate with the third party sellers, indicating that they have obtained products during promotional activities such as the “Buy One, Get One” (BOGO) promo. The quantity of SKU remained significantly elevated throughout the second quarter against the same period of the previous year, and slightly lower compared to the first quarter. The GNC.com home page also reflects a normal promotion on a daily basis, a sort of “% off everything” or BOGO promotion.
The data were collected in order to assess how the levels of promotions can affect sales. Based on daily observations, the promotional levels have accelerated in the last two weeks of the last quarter, indicating that the company needs to make up for lost ground. The second quarter downside was due to the “normal” promotions during the 65% of the quarter, while “BOGO promotion” and “% off promotion” during 20% and 15% respectively during the same quarter.