Last week, Oprah Winfrey made headlines by announcing her departure from the board of WeightWatchers International Inc., marking the end of a decade-long association as the prominent figure of the brand. The market response to this news was unfavorable, with shares of the company plummeting by 18 percent. The stock landed at $3.12 after the first trading day post-announcement. But it seems Winfrey walked away with a bag.
Billionaire Banking More Millions
Analysis conducted by Verity, an insider trading research and analytics firm, reveals that she amassed a total of $221 million from her deal with Weight Watchers.
Since reaching its peak during the Winfrey era in 2018, the stock has experienced a staggering 96 percent decline. Furthermore, it has seen a decline of approximately 50 percent since the partnership between Weight Watchers and Winfrey was unveiled in October 2015. Notably, WW International rebranded itself from Weight Watchers in 2019, and Winfrey disclosed her use of a weight-loss medication last year.
Despite the current challenges faced by the weight-loss-program company in an era dominated by medications like Ozempic and other diet pills, Winfrey’s association with Weight Watchers proved to be financially rewarding.
Market Watch reported that Winfrey initially invested $43.2 million to acquire 6.3 million shares at $6.79 a share, becoming a major shareholder. However, as the company’s stock started to peak in 2018, Winfrey began selling her shares. By 2021, she had generated $286 million from these sales.
Winfrey’s profit from the sale of shares totaled $286 million, achieved through selling 7.2 million shares between 2018 and 2021 at an average price of $49.60 per share, as reported by Market Watch.
However, after deducting initial payment and exercise costs, Winfrey’s net earnings from the stock sales amounted to $221 million, according to data from Verity.
According to FactSet, Oprah Winfrey held approximately 1.1 million shares in WW. Despite this contradiction that would have reduced her amount, she still qualified as the company’s largest individual shareholder, maintaining a stake of 1.43 percent.
Winfrey has announced her intention to donate her interest in Weight Watchers to the National Museum of African American History and Culture, a part of the Smithsonian Institution in Washington, D.C.
Weight Watchers expressed its support for Winfrey’s decision, stating that it backs her choice to donate all of her stake to the museum during the company’s upcoming trading window in March, according to Time Magazine.
“Ms. Winfrey is making the donation to support the NMAAHC’s goal to promote and highlight the contributions of African Americans and to eliminate any perceived conflict of interest around her taking weight loss medications,” the company said. “In addition, Ms. Winfrey intends to donate the proceeds from any future exercises of her WW stock options to NMAAHC.”
Winfrey announced on Feb. 29 her departure from its board of directors via her decision to seek re-election at the upcoming shareholder meeting in May.
According to Time magazine, Oprah left WW a couple of months after it was revealed that she was using a weight-loss medication in December.
It was in an exclusive interview with People magazine that Oprah revealed to incorporate medication to her dieting and workout routines.
It remains uncertain which medication Winfrey is using, Ozempic or Wegovy. Both medications feature the same active ingredient, semaglutide, and are administered once a week. However, Wegovy is specifically designed for weight loss, containing a higher dosage of semaglutide, whereas Ozempic is commonly prescribed for the treatment and prevention of Type 2 diabetes. Both medications necessitate lifestyle changes to achieve effectiveness.
Weight Watchers’ CEO, Sima Sistani, is not viewing the departure as overly grim. Instead, she’s embracing the challenge of navigating the shifting landscape, particularly with the acquisition of Sequence, now rebranded as WeightWatchers Clinic, to venture into the clinical business, CNBC reported.
There are several alternative weight loss medications available to cater to the increasing demand. However, the FDA requires that these GLP-1 drugs be prescribed along with diet and exercise programs. This has might give WW, and its competitor, Noom, a new set of clients even after losing its star board member.
