Track the companies that matter to you. It's FREE! Click one of these fan favorites to get started: Apple; Google; Ford.



Whip Your Portfolio Into Shape With These Fitness Stocks

Watch stocks you care about

The single, easiest way to keep track of all the stocks that matter...

Your own personalized stock watchlist!

It's a 100% FREE Motley Fool service...

Click Here Now

The benefits of exercising seem to be popping up everywhere lately: It helps relieve stress. It helps you focus more at work. It leads you to be more confident, outgoing, and just generally awesome. It can even bring about world peace. OK, just kidding, I made that last one up.

But here's one I'm not making up: It could bring huge gains to your portfolio, via the companies who profit from our increasingly health-conscious ways. I'm talking about companies like Nike (NYSE: NKE  ) , lululemon athletica (Nasdaq: LULU  ) , Town Sports International Holdings (Nasdaq: CLUB  ) , and Life Time Fitness.

Are all fitness stocks created equal?
Of the companies listed above, the last two are probably the riskier investments. These companies own and operate fitness centers in the U.S. -- something we all love in theory, but definitely not necessary for a healthy lifestyle. They are, in fact, somewhat of a luxury, and as such they are usually one of the easiest and earliest things to get cut when money gets tight -- especially if it's between that or better workout gear and higher-quality foods.

Fellow Fool Sean Williams really doesn't like the fitness center stocks, noting their cyclicality and lack of pricing power. I'd say he's right on the money. Their one saving grace may be the growing trend of group workouts, like Zumba, fitness boot camps, and cycling classes. But you don't necessarily need a gym for those things. They can all be hosted independently, and much like Jane Fonda's VHS tapes, could end up being a passing fad.

Just do it
While there is room for the fitness center companies to turn the game around as more and more Americans choose to follow a healthier lifestyle, things look a lot more promising (and stable) for companies that offer the workout gear, like Nike, Under Armour (NYSE: UA  ) , or Lululemon. Even companies like Gap (NYSE: GPS  ) stand to see increased revenue from the athletic lines their brands offer.

Nike has a seriously strong brand abroad, and is making a big push into China to capitalize on it. While Gap's athletic offerings are still a small part of revenue, Gap's "other" segment, which includes Athleta and Piperlime, recently saw 34% sales growth. Under Armour continues to impress the Street with a 37% gain year to date and now realizes more than twice the earnings per share it did at the end of 2009.

Lululemon in particular has been an amazing multibagger for many of its investors. It succeeded by creating a unique brand that resonates with a growing audience worldwide. Some of our top analysts have discovered the next rule-breaking multibagger and put together a special free report with all the details you need to know. Click here to read it now.

Fool contributor Amanda Buchanan holds no position in any company mentioned. Click here to see her holdings. The Motley Fool owns shares of lululemon athletica. Motley Fool newsletter services have recommended buying shares of lululemon athletica and Nike, as well as creating a diagonal call position in Nike. The Motley Fool has a disclosure policy. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.

Read/Post Comments (0) | Recommend This Article (6)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Compare Brokers

Fool Disclosure

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 1877071, ~/Articles/ArticleHandler.aspx, 10/22/2016 4:18:28 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Today's Market

updated 19 hours ago Sponsored by:
DOW 18,145.71 -16.64 -0.09%
S&P 500 2,141.16 -0.18 -0.01%
NASD 5,257.40 15.57 0.30%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

10/21/2016 4:00 PM
LULU $57.00 Down -0.77 -1.33%
Lululemon Athletic… CAPS Rating: ***
CLUB $2.50 Down -0.05 -1.96%
Town Sports Intern… CAPS Rating: *
GPS $26.41 Down -0.07 -0.26%
Gap CAPS Rating: **
NKE $51.77 Down -0.12 -0.23%
Nike CAPS Rating: *****
UA $37.94 Down -0.47 -1.22%
Under Armour (A Sh… CAPS Rating: ****