3 Stocks Leading America's Healthy Transition

America's transition from fatty, calorie-packed foods to healthier options has heated up over the last few years and is only gaining steam in 2013. Growth has been seen across all forms of health and nutrition companies, such as national nutrition retailers, independent supplement distributors, and the brands selling within your local grocery store. Let's take a look at some of the largest companies in the world within these spaces and see what kind of growth we can expect through 2014.

Retail giant
GNC Holdings  (NYSE: GNC  )  is the owner, operator, and franchisor of 8,444 GNC, or General Nutrition Center, locations worldwide. It is a specialty retailer of health and wellness products and also manufactures its own line of supplements. Its products include vitamins, nutritional products, and dietary supplements, as well as fitness equipment and accessories. The company also released a new line of pet care products which gives it exposure to another multibillion-dollar industry.

Source: GNC.com.

On Oct. 24, GNC reported earnings of $0.76 per share on revenue of $675.6 million; this represents earnings growth of 24.6% and revenue growth of 8.7% year over year. The aforementioned results paired with an uplifted fourth-quarter forecast allowed management to raise its full-year outlook for fiscal 2013, which now calls for annual earnings growth of 22% to 24%. On top of the positive earnings, GNC pays a healthy 1.02% dividend, which could easily be raised in the coming years due to its ample free cash flow. GNC is my favorite play on America's healthy transition.

Independent distribution
Herbalife  (NYSE: HLF  )  is a global nutrition company that offers its products through independent distributors in more than 80 countries. It offers products for targeted nutrition, weight management, energy and fitness, meal replacement, skin and hair care, and kids' nutrition. Herbalife has one of the best management teams in the industry that continues to innovate in order to keep up with consumer demands and trends.

Source: Herbalife.com.

On Oct. 28, Herbalife released earnings that beat analyst expectations on both the top and bottom lines. Earnings came in at $1.41 per share on revenue of $1.21 billion. Earnings per share grew an incredibly strong 43.9% and revenue rose 19% year over year while worldwide volume increased 13%. This marked the 16th consecutive quarter of double-digit revenue growth and the 19th consecutive quarter of exceeding Wall Street's estimates. As a result of the strong quarter, management raised its full-year outlook, which was actually the third time they had done so this year. Herbalife is a company firing on all cylinders and in my opinion a great value play on any weakness.

Grocery brand
The health craze in America has been shown with every new fad diet taking off: From acai berry and raspberry ketones to Atkins and Weight Watchers, the companies behind the products or brands have had great success. This has been demonstrated in the specialty foods market as Boulder Brands  (NASDAQ: BDBD  )  became the face of the gluten-free diet. Boulder is home to the Smart Balance, Glutino, Udi's, Earth Balance, and Best Life brands.

Source: SmartBalance.com.

In its latest quarterly report, the company grew earnings to $0.05 from $0.01 year over year as revenues rose 45.7% to $110.70 million. Management noted the increased popularity of its brands with consumers and raised its full-year outlook for fiscal 2013. The company has seen its stock rise over 25% year to date and 165% in the last two years, so sales jumping could only mean a continued run higher for Boulder. If you are looking for a company with exposure to healthy food products rather than nutritional products and supplements, look no further than Boulder Brands.

The Foolish bottom line
The health food industry is a tough one to crack and gain share in, but GNC, Herbalife, and Boulder Brands have proven themselves as three of the top companies in the space. All three have favorable forward estimates and momentum going into the fourth quarter, so I think buying any of these on weakness would be a smart move. America's switch to healthier foods is a trend everyone's portfolio should have exposure to, so take a look and see if yours could use one of these great companies.

Stocks for a healthy portfolio
Dividend stocks can make you rich. It's as simple as that. While they don't garner the notoriety of high-flying growth stocks, they're also less likely to crash and burn. And over the long term, the compounding effect of the quarterly payouts, as well as their growth, adds up faster than most investors imagine. With this in mind, our analysts sat down to identify the absolute best of the best when it comes to rock-solid dividend stocks, drawing up a list in this free report of nine that fit the bill. To discover the identities of these companies before the rest of the market catches on, you can download this valuable free report by simply clicking here now.


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