4 Stocks That Score With New Year’s Resolutions

by Traders Reserve | January 2, 2014 2:07 pm

4 Stocks That Score With New Year’s Resolutions

Estimates show that people fall off the resolution wagon 38 days after New Year’s Day. We spend months and years learning and living with bad health habits then expect that a willpower miracle will happen at the stroke of midnight.

Many of us blame the period between Thanksgiving and a new year for feeling bloated and heavier than usual. The fact is, however, that most people gain less than one pound from all the holiday cheer. It’s the collective 35 pounds on average we gain between age 25 and 60 that fool us into thinking the turkey made us fat.

We eat too much, drink too much and don’t exercise enough; and 46 million Americans smoke cigarettes on top of all that. Puffers “quit” at least six times before they finally stop for good. Only about 4% to 6% can do so without medicines or a doctor’s help. Of course, while no studies have proven that e-cigs can help people stop smoking, people do use them in an effort to do so or at least to “smoke healthier.”

It’s no wonder the industries that cater to helping people follow through on health resolutions are rolling in dough.

Check out these stocks to buy: all are companies that appeal to consumers with health-related resolutions, and all involve that New Year’s Resolution:

Weight-loss resolutions propel Nutrisystem

Total U.S. weight loss market revenues were $61.6 billion in 2012 and $60.6 billion in 2011. Revenues are forecast to grow 2.6% in 2013. If we stuck to our guns, this industry would be losing right along with all of us, but that’s not the case for Nutrisystem (NTRI).

As weight loss resolutions and efforts grow in the early part of the year, so do sales of Nutrisystem products. First-quarter sales have improved over the past six years by an average of 25.1%.

After the company reported a 5% year-over-year revenue gain in the 2013 third quarter, the stock climbed to two-year highs. This can be attributed to lower costs and shift in marketing strategy. Expect the first quarter to fatten investors’ wallets again.

Shape up your portfolio with Nike

There are actually two trends within exercise-related resolutions. People want to look good doing whatever it is they’re doing, and they need the latest monitoring tool to keep track of progress. Nike fits the bill of both.

The wearable technology industry is expected to grow between $10 billion and $50 billion in the next five years. Nike introduced the Fuelband wristband in January 2012 and has since become a category leader among activity trackers. The company found that 98% of their 20 million users exercised although they didn’t necessarily follow through with the five minutes every hour guideline. This type of innovation—and the popularity of its all-sports apparel— is behind Nike’s revenue target of $36 billion by fiscal 2017 or annual growth of 10%.

A move away from smoking: Lorillard and Vapor

Euromonitor forecasts retail sales in 2013 for e-cigarettes worldwide will be $2.5 billion, top $10 billion by 2017, and exceed their tobacco counterparts by 2047. The market is sparked not only by current smokers looking to quit or become healthier but by the younger generation eager to experiment.

That said, demand for the products is certainly headed north for the long haul.

Lorillard  (LO[1]) became the first big tobacco company to enter the e-cig universe and has recently acquired SKYCIG, a premium brand in the UK. With a 49% market share and a global presence, it is perfectly positioned to ride the trend higher. LO also kicks in a 4.2% dividend.

Should you be interested in the only pure e-cig play, take a look at Vapor (VPCO[2]). The company began selling its products in mall kiosks but has since become a $58.5 million publicly traded company. Vapor Corp. has reached a 10% market penetration with products at 60,000 locations nationwide.

Endnotes:
  1. LO: http://studio-5.financialcontent.com/investplace/quote?Symbol=LO
  2. VPCO: http://studio-5.financialcontent.com/investplace/quote?Symbol=VPCO

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