Q. I'm a U.S. representative and distributor of Nu Skin. I'm interested in your opinion of Nu Skin's stock. What's the outlook? - G.H., Park Ridge, Ill.
A. Here's the skinny: Nu Skin Pacific Inc. is changing its name to Nu Skin Enterprises for reasons that are a bit complicated.
The company acquired from its private affiliate Nu Skin International the rights to the Nu Skin name and trademarks and to market Nu Skin personal care and nutritional products worldwide, except in the United States. In this country, marketing rights are held by the shareholders of NSI, which will now operate as Nu Skin USA.
Wall Street analysts who follow Nu Skin Asia Pacific stock give it a consensus "strong buy" recommendation, according to the I/B/E/S International research firm. This includes three "strong buy" and two "buy" ratings.
Earnings are expected to grow at a 23 percent clip this year, right in line with the consumer service industry. Next year's growth is pegged at 25 percent, the same as its peers. Its projected median five-year annualized growth rate is 19.5 percent.
"Nu Skin looks like an interesting stock with growth earnings and positive analyst recommendations," noted Peter Crays, manager of U.S. research for I/B/E/S.
This direct-sales company, with more than 500,000 distributors and 2,000 employees, makes facial-care, body- and hair-care products, color cosmetics and specialty products such as sun-protection products, oral-hygiene products and fragrances. It distributes nutritional, weight-management and sports-nutrition products. Japan recently accounted for 56 percent of revenue, Taiwan 22 percent and South Korea 18 percent.
Q. I bought Perkins Opportunity Fund a few years ago when small-cap stocks seemed to be on a roll. I was assured by my broker that it was the fund of the future. Since that time it seems to have gone into the Dumpster. What gives? - R.J. Hammer, Oak Park, Ill.
A. Despite a 70 percent gain in 1995, this volatile fund has wound up as a cellar dweller among small-company growth funds.
It's only the right ticket for you if you're seeking a speculative play and you have confidence in its management.
The $56 million Perkins Opportunity Fund gained 13 percent over the past 12 months and turned in a three-year annualized return of 6.75 percent. Both returns ranked in the lowest 5 percent of all funds in its category.
"Because the fund managers (Richard and Daniel Perkins) want to know their companies intimately, they invest half of their portfolio in health-care and technology stocks based in their home state of Minnesota," observed Bridget Hughes, fund analyst with the Morningstar Mutual Funds investment advisory. "They're limiting their investment universe with a strategy and objective that probably shouldn't have that kind of limit."
Operating with companies that average a tiny average market capitalization of $102 million, the fund has made its strong bets in health care, services and technology. Its top holdings were recently TCF Financial, Norstan, Diametrics Medical, AMETEK, IVI Publishing, Ciprico, Orphan Medical, Patterson Dental and Metris Co. This fund, based in Wayzata, Minn., requires a 4.75 percent "load" (initial sales charge) and $2,500 minimum initial investment.
Q. What is a penny stock and how can I get information or pamphlets about penny stocks? - D.P., Minden, W.Va.
A. A high-risk penny stock typically sells for less than $5 a share but may rise significantly shortly after its highly promoted initial public offering. Where it eventually winds up is usually a different story.
Penny stocks are sold over-the-counter, many in the local Denver, Vancouver or Salt Lake City markets. The National Association of Securities Dealers in recent years has limited the selling of speculative securities over the telephone.
"Penny stocks have little information attached to them in terms of corporate reports, industry information or stock performance," noted tips.
"Don't bet the house here on these stocks, but maybe the kids' bedroom, which means I would not put more than 10 percent of my portfolio in speculative stocks," said George Schlieben, publisher of Global Penny Stocks, Yardley, Pa. "We use a target time of between 12 to 24 months."