4 Fitness Stocks To Buy This Summer

There is growing inclination for a healthy lifestyle in the United States. Consumers are increasingly demanding healthier food and beverages, health-friendly activities, and medications in pursuit of good health and fitness.

Food, beverage and retail companies, are therefore in the limelight because of this changing preference and investing in these stocks seems prudent.

Americans are Now More Health-Conscious Than Ever

According to a 2018 Forbes report, the International Health, Racquet & Sportsclub Association in 2018 stated that the $30-billion U.S. health and fitness industry is growing 3-4% annually for the past 10 years. In fact, the numbers are growing as millennials are increasingly joining health-friendly activities.

After all, higher stress levels and increasing health insurance costs are the major reasons driving people to stay fit. It is not surprising that many employers now cover costs of fitness studios and health club memberships, urging employees to avail them. Undoubtedly, it costs less to insure healthy people.

Per the Forbes report, about a fifth of American adults have a fitness club membership, and these numbers are expected to rise. Also, the preference for organic food and low-calorie beverages over processed food clearly indicates how careful consumers are about what they eat and drink.

Once consumers tend to eat healthy, they will think of other ways to stay fit, which creates demand for fitness and yoga studios. A record number of people registering to celebrate the fifth International Day of Yoga this year in Washington alone reflects keenness for fitness activities.

Growing Demand for Health-Friendly Products

This growing preference for a fit lifestyle is influencing the products’ marketed today too. Companies are increasingly altering their products to cater to the large segment demanding them.

For example, Coca-Cola (NYSE:KO) is gradually reducing sugar levels in its drinks to meet consumers’ changing tastes. The company’s Freestyle machines are also promoting its low and no-calorie drinks. Coca-Cola reportedly removed 425,000 tons of sugar from its products annually in 2017 and 2018, with the help of smaller packaging and new recipes.

The demand for bottled water has risen too, overshadowing demand for carbonated drinks. Per a Beverage Marketing Corporation report, the per capita consumption of bottled water in U.S. was more than 42 gallons last year compared to the 37-gallon average intake of carbonated soft drinks.

Consumer demand for other fitness products such as wearables and fitness apps are on the rise as well. Fitbit, Apple (NASDAQ:AAPL) Watch and Garmin have taken the smartwatch market by storm, which is expected to reach $43.8 billion by 2023, per a P&S Market Research report. Demand for athletic wear is growing too with the likes of Nike (NYSE:NKE), Puma and Adidas (DE:ADSGN) among industry leaders.

Our Choices

We have chosen four fitness stocks that you could consider adding to your portfolio. These stocks carry a Zacks Rank #1 (Strong Buy) or 2 (Buy).

Weight Watchers International, Inc. (NASDAQ:WW) provides weight management services. The company offers a wide variety of products and services that consist of nutritional, activity, behavioral and lifestyle tools.

The company currently has a Zacks Rank #1. The Zacks Consensus Estimate for its current-year earnings has risen 18.6% over the past 60 days.Weight Watchers International’s expected earnings growth rate for the next year is 23.5% compared with the Zacks Consumer Services – Miscellaneous industry’s projected rise of 16.9%.You can see the complete list of today’s Zacks #1 Rank stocks here.

Lululemon Athletica Inc. (NASDAQ:LULU) is a designer and retailer of athletic apparel and fitness-related accessories. The company’s apparel is ideal for healthy lifestyle and fitness activities.

The company currently has a Zacks Rank #2. The Zacks Consensus Estimate for its current-year earnings has risen 0.7% over the past 60 days. Lululemon Athletica’s expected earnings growth rate for the next year is 18.5% compared with the Zacks Textile – Apparel industry’s projected rise of 16.7%

The Simply Good Foods Company (NASDAQ:SMPL) provides nutrition bars, snacks, ready-to-drink shakes and confectionary products etc. The company currently has a Zacks Rank #2. The Zacks Consensus Estimate for its current-year earnings has risen 1.6% over the past 60 days. Simply Good Foods’ expected earnings growth rate for the current year is 12.1% compared with the Zacks Food – Confectionary industry’s projected rise of 10.6%.

Medifast, Inc. (NYSE:MED) manufactures and markets weight loss, weight management, healthy-lifestyle products and other consumable health and nutritional products.

The company currently has a Zacks Rank #2. The Zacks Consensus Estimate for its current-year earnings has risen 4.3% over the past 60 days. Medifast’s expected earnings growth rate for the current year is 47.2% compared with the Zacks Food – Miscellaneous industry’s projected rise of 2.9%.

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