4 Stocks That Are Fit for Fitness

You may have been busy reading or listening in recent days to news about the latest on either Greece's pending exit from the eurozone or the Fed's June Federal Open Market Committee statement. Given the volume of noise associated with both, it's easy to see how one could be distracted. One of the dangers associated with times such as these is that we become so focused on one particular event that we tend to look at the world through blinders and miss other happenings. That rope-a-dope strategy served former world heavyweight boxing champ Muhammad Ali well in his 1974 Rumble in the Jungle match against George Foreman. However, when it comes to the market and your investments, getting distracted or too focused on any one thing or event can be costly because there are almost always nuggets of information that could be missed. One example is news this week of a study form the Centers for Disease Control and Prevention that the average man is 30 pounds heavier than in the 1960s ¿ 195.5 pounds today versus. 166.3 back then. And it's not just men who are heavier; the average American woman weighs 166.2 pounds, almost exactly as much as the average American man weighed in the early 1960s. Chalk it up to more hectic and digital lifestyles that have us working and sitting more and the rise of convenient, but less-than-good-for-you food to help mitigate that hectic lifestyle. Think about the last time you walked through Kroger (KR) or the grocery sections of Wal-Mart (WMT) or Target (TGT). You most likely saw all sorts of microwaveable foods and other pre-fab meals and snacks. As you loosen your belt or drawstring, ponder that according to BMC Public Health, Americans are now the world's third-heaviest people, behind only the Pacific island nations of Tonga and Micronesia. At this rate, the futuristic world depicted in Disney's Wall-E ¿ in which we humans have grown too bloated to walk and too lazy to think ¿ may not be some far-off fantasy. I jest, but over the last few years more and more data over the costs associated with diabetes and other obesity-related illnesses have been published, and in a word they are staggering. According to the Journal of Health Economics, The estimated annual health care costs of obesity-related illness are a staggering $190.2 billion, or nearly 21% of annual medical spending in the United States. Yikes! That is huge ¿ and yes, that pun was intended. Pain points such as that have been profitable fodder for investors, and when looking at companies such as Weight Watchers (WTW), would-be obesity drug company Vivus (VVUS), Medifast (MED) and Nu Skin Enterprises (NUS), one would think they would be zooming. Looking at the charts, however, we see a different reality. The only weight management stock that is working these days is NutriSystem (NTRI). At 24x expected 2016 earnings of $1.04, and bumping up the consensus price target around $25, the shares don't appear to have much upside for those just coming to the turnaround story now. The larger question is, Where have all those people looking to trim down gone? The answer is they are eating healthier food as well as exercising or simply moving more. To me, the obvious winners under that scenario are Nike (NKE), Under Armour (UA), United Natural Foods (UNFI) and newly public Fit Bit (FIT). We own NKE, UA and UNFI shares in the Thematic Growth Portfolio and would have participated in FIT had we gotten some shares on the initial public offering. With FIT shares skyrocketing today, up more than 50%, we'll watch the shares for when the euphoria wears off and some froth comes out of the stock market.

4 Stocks That Are Fit for Fitness

These companies should feast as more obese Americans turn to exercise and healthy foods.

Columnist Conversation

This Weekend on Real Money

Wednesday on Real Money Pro

Pretty Incredible + Hard to Believe

COLUMNIST TWEETS

Please Join or Log In to manage and receive alerts.