WW International Shares Soar On Morgan Stanley Upgrade: Acquisition Of Sequence Spurs Unprecedented Growth

Shares of WW International Inc WW were spiking on Wednesday, as the stock has climbed over 200% year to date.

The company’s acquisition of GLP-1 telehealth brand Sequence has “created a rare scenario where one plus one equals three,” according to Morgan Stanley.

The WW International Analyst: Lauren Schenk upgraded the rating for WW International from Equal-Weight to Overweight, while raising the price target from $5 to $13.

The WW International Thesis: While thematic exposure to GLP-1 obesity drugs is “highly sought after by investors,” WW International has exhibited the ability to leverage its brand to drive “low-cost Sequence subscriber growth,” Schenk said in the upgrade note.

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“Sequence has tripled its market share of free web traffic to GLP-1 telehealth players post-acquisition, from ~10% to ~30%, despite minimal active cross-selling to date,” the analyst wrote. “That translates to a ~3.5x increase in unique visitors which implies quick subscriber growth,” he added.

Sequence’s share gains could continue as WW International “ramps its integration plans and markets to the estimated ~6M current and lapsed WW subscribers that qualify for GLP-1s,” Schenk further stated.

WW Price Action: Shares of WW International were up 19.94% to $11.91 at the time of publication Wednesday.

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