Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of fitness club operator Town Sports International Holdings, Inc. (NASDAQ:CLUB) plunged 12% today after its quarterly results and outlook disappointed Wall Street.

So what: The stock has pulled back sharply in 2014 on concerns about rapidly declining fundamentals, and today's first-quarter results -- net loss of $3.5 million on a revenue decline of 2.7% -- coupled with downbeat guidance only reinforce those worries. In fact, Town Sports' comparable-club revenue slipped 4.7%, while its total member count decreased 1,000 members to 496,000 members, suggesting that its competitive position is deteriorating even faster than Wall Street had expected.

Now what: For the current quarter, management now expects a break-even bottom line on revenue of $116.0 million-$117.0 million. "[T]he longer-term combination of an increased consumer focus on fitness and health and our initiatives to capture share of this expanding market keeps us excited, motivated, and optimistic about our medium to long-term growth plans," CEO Robert Giardina reassured investors. "We will continue to aggressively pursue our strategic initiat[iv]es in order to be well-positioned for the opportunities we see ahead." Given the notoriously cutthroat nature of the fitness club space, however, I'd hold out for an even wider margin of safety before betting on it. 

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.