Oprah Winfrey’s Weight Loss Tweet Is Big Gain For Weight Watchers Stock Price
Oprah Winfrey sent shares of Weight Watchers soaring more than 20 percent on Tuesday. Immediately after posting a video to Twitter announcing she lost 26 pounds, the stock price of the company rose $2.17 to $13.29 a share.
Eat bread. Lose weight. Whaaatttt? #ComeJoinMe https://t.co/jUgpk9ToXYhttps://t.co/xtnB53EwSf
— Oprah Winfrey (@Oprah) January 26, 2016
Oprah says the pounds fell off by following the Weight Watchers diet plan and eating bread. “This is the joy for me,” Winfrey said. “I don’t deny myself bread. I have bread every day.”
During an appearance on The Ellen DeGeneres Show in October, Winfrey announced she was using the Weight Watchers plan and had already lost 15 pounds.
Weight Watchers even changed their program to be a better fit for Oprah’s lifestyle. “But I am excited about Weight Watchers being able to bring a healthier, more holistic approach for everybody,” she told Ellen.
While her waistline may have decreased, the weight loss increased her pocketbook. The timely tweet came three months after Winfrey bought a $43 million stake in Weight Watchers.
As reported previously by the Inquisitr, Oprah Winfrey owns about 10 percent of Weight Watchers, plus holds a seat on the company’s board of directors. The gains made Tuesday means she is $14 million richer, on paper at least. If you add in the options she has in the company, that figure goes to a whopping $19.2 million gain in one day.
The 61-year-old media personality and actress is already worth $3.1 billion. According to Winfrey, the decision to invest in the company came after she saw the diet plan was working. The investment by the media mogul doubled the price of Weight Watchers stock to $15 shortly after the announcement in October.
However, investor excitement for the struggling company quickly died down. Since the 2015 peak of $28 a share, Weight Watchers stock plummeted more than 50 percent in December according to a CNN Money report.
Another Oprah video tweet in late December did help the company recover some of the loss. Nonetheless, Weight Watchers stock price is still down 21 percent from a year ago.
Jim Chambers, Weight Watchers CEO, said website traffic significantly increased in November thanks to Oprah. Investors, however, are skeptical if Oprah’s involvement with the company will increase the number of paying members.
Under a five-year deal and subject to her approval, Weight Watchers can use her name, image, likeness, and endorsement for the company, its programs, products, and services. Ads featuring Oprah started appearing in December.
In the video, Winfrey opens up about her past battles with weight and stresses the importance of working towards a new body.
“Nothing you’ve ever been through is wasted, so every time I tried and failed, every time I tried again, and every time I tried again, has brought me to this most powerful moment to say, ‘If not now, when?'” she asks.
The ad did stir up some controversy. In the video, Oprah makes a reference that an overweight woman isn’t living up to personal expectations of being a woman. Many women quickly took to social media saying how much they weigh shouldn’t affect what kind of woman they are.
Industry analysts say Weight Watchers is the type of stock investors like to bet against. They often borrow the stock, sell it, then buy it back later at a lower price.
However, “short selling” a stock can be risky, especially when a popular celebrity spokesperson is suddenly slimmer. An unexpected spike in the Weight Watchers stock price could mean a big loss for someone who is betting the price is going the other way.
Weight Watchers has struggled in recent years against the popularity of free diet apps and fitness trackers available on smartphones. The company’s market value went up almost $150 million after the Oprah Winfrey Twitter post to her 31 million followers.
[Photo by Kevin Winter/Getty Images]
