WW International (WW -4.82%), the parent company of WeightWatchers, got a huge 59% boost in its share price on Tuesday. The company benefited from a generous price target set by Goldman Sachs. Here's why the top investment bank is bullish on the weight-loss company, and whether you should consider buying the stock today.

WW gets a big upgrade

Earlier this week, Goldman Sachs changed its price target for WW International from $3.80 to $13. That's more than three times what the stock was trading at. Another brokerage, D.A. Davidson, set a more modest price target of $9 on Thursday, but it, too, is bullish on the company's prospects. Analyst price targets typically look at a period of 12 months, so in the long run these analysts may expect even more upside for WW International.

The big reason for the bullishness from some analysts is that WW International recently closed on an acquisition for Sequence, which runs a subscription telehealth platform.

Telehealth hasn't been an exciting place to invest in of late, but what's key is that Sequence gives people access to providers who specialize in chronic weight management and who can prescribe treatment such as Wegovy and Ozempic. Wegovy, which is approved for weight loss (Ozempic is approved for diabetes), has shown that it can help people lose an average of 15% of their body weight.

Why this could be a great move

For the WeightWatchers brand to link up with a company that can help connect patients to some incredibly popular weight-loss treatments has the potential for all sorts of synergies and growth opportunities. Analyst Linda Bolton Weiser from D.A. Davidson said it was a "game changer" for the company, noting that more than 70% of WW's members are obese and could benefit from the treatment.

As of the end of 2022, the company had 3.5 million subscribers. And subscription revenue of $919 million accounted for 88% of WW's total sales last year, which were just over $1 billion, with the remainder coming from product sales.

The standard price for a WeightWatchers plan is $23 per month and utilizes an app that gives people access to a "science-based nutrition plan" along with recipes. It also helps members track their weight and activity levels. The company also advertises that "WW members lose 2x more weight than doing it on their own." If they have the potential to gain access to Wegovy through the membership, that could help members potentially achieve even better results.

Why there's still risk when it comes to WW

One of the dangers of jumping in early is that's far too soon to tell how big of an effect this acquisition will have on WeightWatchers' business. When WW announced plans to acquire Sequence, it noted that the telehealth company was generating a run rate of just $25 million in annual revenue. The big assumption in these upgrades -- and for this to pay off for WeightWatchers -- is that it will either lead to a significant jump in subscriptions for WeightWatchers and/or people will be paying more for the subscription.

However, the big problem with these weight-loss treatments has been that demand has surpassed supply, which is why people have been using Ozempic even though it's not approved for weight loss. It's not necessarily an issue that people can't obtain prescriptions, but that the actual drugs are not available. That will change as Novo Nordisk ramps up supply. But that's not something that will exclusively benefit Sequence or WeightWatchers. The danger here is the hype is still fundamentally about WW acquiring a relatively small telehealth business.

Should investors buy WW International stock?

There are a lot of assumptions baked into the stock's sudden rally, and some of them can be dangerous to rely on, such as that sales will drastically improve (they have been declining at WW for years). When there's this much bullishness and excitement behind a stock, it can be a dangerous time to buy because just as quickly as WW International stock has risen in price, it can quickly give back those gains if reality doesn't end up matching expectations.

Investors should wait to see how the results look in future quarters before making a decision on WW International's stock, and to assess whether the acquisition is paying off the way many people expect.