Value
8.0/10data confidence 83%| Component | Sub-score |
|---|---|
| P/E | 2.7 |
| P/S | 10.0 |
| EV/EBITDA | 9.4 |
| Fwd P/E | 9.5 |
| PEG | 7.3 |
- ▸Forward P/E: 8.2x
- ▸PEG: 0.94
- ▸Attractively valued
USNA · Why this verdict
Why USANA Health Sciences (USNA) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictSELL
Overall score4.7/10
ConfidenceMEDIUM
MacroNEUTRAL
TrendMatrix Research · core thesis
Engine thesis — one sentence
USNA screens cheap (7.7x forward P/E) with a favorable 5.74x asymmetric risk/reward and a near-term earnings catalyst off a perfect recent beat streak, but sits just under the $400M investable-universe threshold with a failed momentum gate and an elevated put/call ratio (1.75) ahead of the report.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Trades cheaply on forward earnings, 7.7x forward P/E, flagged attractively valued despite a PEG near 0.89. Valuation breakdown | Forward P/E should re-rate upward toward double digits if earnings growth is sustained. | — |
| CounterThe Rule-of-40 score fails badly, 3 out of a 40 benchmark, showing the combination of growth and margin is weak — the cheap multiple may be appropriately discounting a structurally slow-growth, low-margin business. | ||
The stock carries a favorable engine-calculated asymmetry, 55.5% upside to target versus 9.7% downside to stop, a 5.74x ratio, anchored by a near-term earnings catalyst in 10 days off a perfect 3-of-3 recent beat streak. Estimated upside | The company should extend its beat streak at the upcoming report and price should progress toward the analyst-target-based take-profit level over the following months. | Tripped— |
| CounterThe momentum gate has already failed and the stock sits in range-bound consolidation, RSI 47, mid-Bollinger-band, so a favorable numerical asymmetry doesn't guarantee the technical setup resolves upward around the earnings event. | ||
The options market shows an elevated put/call ratio of 1.75 and very high implied volatility of 127% heading into the earnings report, signaling the market is pricing wide uncertainty and defensive hedging. Risk breakdown | Implied volatility should compress sharply after the earnings event, with the put/call ratio normalizing toward 1.0. | — |
| CounterAn elevated put/call ratio ahead of a binary catalyst could also reflect informed positioning anticipating a disappointing result, not just routine hedging. | ||
Market capitalization of $394M sits just below the $400M minimum threshold, excluding the stock from the investable universe despite the otherwise favorable setup. Bear case | Market cap should climb back above $400M given the modest roughly 1.5% gap, especially if the earnings catalyst is positive. | — |
| CounterThis is a mandate-driven cutoff rather than a fundamental judgment, and could just as easily widen if the stock's already-flagged negative momentum continues. | ||
Trades cheaply on forward earnings, 7.7x forward P/E, flagged attractively valued despite a PEG near 0.89.
—Valuation breakdown
- Expectation
- Forward P/E should re-rate upward toward double digits if earnings growth is sustained.
CounterThe Rule-of-40 score fails badly, 3 out of a 40 benchmark, showing the combination of growth and margin is weak — the cheap multiple may be appropriately discounting a structurally slow-growth, low-margin business.
The stock carries a favorable engine-calculated asymmetry, 55.5% upside to target versus 9.7% downside to stop, a 5.74x ratio, anchored by a near-term earnings catalyst in 10 days off a perfect 3-of-3 recent beat streak.
Tripped—Estimated upside
- Expectation
- The company should extend its beat streak at the upcoming report and price should progress toward the analyst-target-based take-profit level over the following months.
CounterThe momentum gate has already failed and the stock sits in range-bound consolidation, RSI 47, mid-Bollinger-band, so a favorable numerical asymmetry doesn't guarantee the technical setup resolves upward around the earnings event.
The options market shows an elevated put/call ratio of 1.75 and very high implied volatility of 127% heading into the earnings report, signaling the market is pricing wide uncertainty and defensive hedging.
—Risk breakdown
- Expectation
- Implied volatility should compress sharply after the earnings event, with the put/call ratio normalizing toward 1.0.
CounterAn elevated put/call ratio ahead of a binary catalyst could also reflect informed positioning anticipating a disappointing result, not just routine hedging.
Market capitalization of $394M sits just below the $400M minimum threshold, excluding the stock from the investable universe despite the otherwise favorable setup.
—Bear case
- Expectation
- Market cap should climb back above $400M given the modest roughly 1.5% gap, especially if the earnings catalyst is positive.
CounterThis is a mandate-driven cutoff rather than a fundamental judgment, and could just as easily widen if the stock's already-flagged negative momentum continues.
Per-dimension breakdown
Quality
5.3/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 0.5 |
| ROA | 2.8 |
| Gross margin | 10.0 |
| Op margin | 2.2 |
| Net margin | 0.5 |
| Current ratio | 8.5 |
| FCF quality | 10.0 |
| Moat | 6.8 |
| Rule of 40 | 3.0 |
| Piotroski F | 8.9 |
- ▸Excellent cash conversion: 333% FCF/NI
- ▸Rule of 40: 3 (fail)
- ▸Strong Piotroski F-Score: 8/9
Growth
1.3/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 2.6 |
| EPS growth | 0.0 |
Momentum
1.7/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 3.0 |
| MACD | 0.0 |
| OBV | 1.0 |
| MA position | 1.0 |
| Volume | 3.3 |
- ▸Capitulation risk (RSI 28, below 200MA)
- ▸Volume distribution (falling OBV)
- ▸Below 200-MA, MA slope -4.3%/30d — confirmed downtrend
Sentiment
5.5/10data confidence 100%| Component | Sub-score |
|---|---|
| LLM sentiment | 2.0 |
| Analyst rating | 5.0 |
| Price target | 10.0 |
- ▸LLM news sentiment: -0.60 (n=2)
- ▸Analyst upside: 131%
Insider
4.1/10data confidence 100%| Component | Sub-score |
|---|---|
| materiality | 3.0 |
| insider conviction | 2.0 |
| holder change | 6.5 |
| notable moves | 5.0 |
- ▸Notable insider selling — $521,758 (0.124% of mkt cap)
Peer rank
4.7/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 4.8 |
| quality rank | 2.6 |
| growth rank | 2.0 |
- ▸Conservative debt levels
Technical
6.8/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 10.0 |
| support resistance | 9.5 |
| 52w position | 0.0 |
| gap | 7.5 |
- ▸Extreme gap down (-19.9%) - potential reversal
Risk (lower is worse)
4.0/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 6.6 |
| days to cover | 3.7 |
| volatility | 0.0 |
| put call | 0.0 |
| implied vol | 0.0 |
| max pain risk | 3.0 |
| beta | 8.7 |
| debt equity | 9.9 |
- ▸Elevated put/call: 3.00
- ▸High IV: 129%
- ▸Above max pain $5
- ▸Concentration risks: 1 HIGH, 1 MED (10-K Item 1A — sized via position_sizing, validated via buy_confidence)
Catalyst
7.8/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 10.0 |
| surprise avg | 10.0 |
| news activity | 6.0 |
- ▸Strong earnings: 3B/0M
How the verdict was assembled
Engine trigger
Multiple concerning factors. Consider reducing position.
Engine technical detail
verdict_path:
L4:PATH_F_SELLPassed (6)
- ASYMMETRY:6.5>=1.5
- INSIDER:OK
- 8K:CLEAN
- EARNINGS_PROXIMITY:NO_DATE
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (1)
- MOMENTUM:1.7<4.5
Warning (0)
none
Reward-to-Risk
6.45
Upside
+96.7%
Downside
15.0%
Sizing output
AVOID
Setup— — No clear chart pattern; technical signals are mixed
EdgeInst Constrain — Small cap ($0.4B) below institutional reach
SuitabilitySpeculative — Drawdown -56% (>40% off 52w high)
Investment implication
The F-path SELL output reflects an overall score of 4.7 below the 5.6 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Value at 8.0) was not enough to lift the adjusted overall above the threshold. Co-occurring failed gates ( MOMENTUM:1.7<4.5) reinforce the read. Current asymmetry R:R is 6.45 — supplementary context, not the trigger for this path.
The strongest dimensions are Value at 8.0, Catalyst at 7.8, and Technical at 6.8; the weakest are Growth at 1.3, Momentum at 1.7, and Risk (lower is worse) at 4.0. The V9 engine flagged 1 failed gate, producing an asymmetric reward-to-risk of 6.45 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Cheap Forward Multiple
Trip ifForward P/E compresses further below 5x, from the current 7.7x, while the Rule-of-40 score stays below 10, confirming the cheap multiple reflects deteriorating fundamentals rather than mispricing.
- P2Earnings Catalyst AsymmetryTripped
Trip ifPrice falls below the $19.83 stop-loss level, more than 9.7% below current price, around the earnings report, invalidating the favorable asymmetric setup.
- P3Elevated Pre Earnings Options Positioning
Trip ifImplied volatility stays above 100% for more than 2 weeks after the earnings report, showing the elevated pre-earnings volatility was not simply an event-driven spike.
- P4Below Investable Universe Cutoff
Trip ifMarket capitalization falls further below $350M, rather than recovering above $400M, within the next 2 quarters, widening the gap to the investable-universe threshold.