Shares of GNC Holdings (GNC) are in focus this morning as the nutritional products retailer closes all of its U.S. stores today to overhaul its pricing system.

WHAT'S NEW: GNC is closing all of its 4,440 stores in the U.S. today to overhaul its pricing system as it looks to replace what it has described as "an old broken model." According to a Wall Street Journal report, when the stores reopen on Thursday, labels for its products will feature just one price, with about half of the company's products starting at lower prices than before. Earlier this month, GNC said it would provide a "dramatically improved experience" and single pricing online in its brick and mortar stores, calling its new initiative "One New GNC." The branding initiative also includes a new loyalty program called My GNC Rewards, that will have points and rewards, as well as a new GNC mobile app. As part of the upgrade, the retailer is also rolling out new POS terminals across the chain that will speed the checkout process, and help guide customer decisions based on purchase history and manage loyalty programs. In addition, GNC store associates will be given tablets that support their training and will help them to answer customers' questions and recommend products and wellness regimens. GNC's interim CEO, Robert Moran, said at the time that the company is making these investments "because we believe in this business, its future and our ability to return to growth and deliver shareholder value." He also commented that the New GNC "leaves the old, broken model behind. We're confident it will have a positive impact on the business, but it will take time for the changes to take hold and translate to improved financial results." Shares of GNC have declined about 63% year-to-date. In late October, shares dropped 25% in one day after the company reported quarterly same-store sales that fell 8.5% and adjusted EPS and sales that were well below analysts' expectations.

WHAT'S NOTABLE: GNC's overhaul highlights a basic problem that has baffled many retailers, including Restoration Hardware (RH) and Abercrombie & Fitch (ANF) involving how to set prices for products they sell, The Wall Street Journal noted in its report. Bed Bath & Beyond (BBBY) CEO Steven Temares last week commented that "To be at the wrong price going forward, the customer won't find you. When they go online, we're not going to be relevant. We're not going to show up in algorithms."

PRICE REDUCTIONS REPRESENT 'MEANINGFUL' EARNINGS RISKS: On December 23, Piper Jaffray analyst Sean Naughton cut his price target on GNC to $7 from $11, saying that price reductions and the elimination of the paid membership "represent meaningful earnings risks." Naughton believes GNC's trends likely will not improve soon and that its leverage is concerning.

PRICE ACTION: GNC is down 1.7% to $11.35 in morning trading.