Weight Watchers: Dollars from diets

Helping customers slim down adds profits to this company's bottom line.

By TheStockAdvisors Mar 15, 2012 10:18AM
By Mark Skousen, Hedge Fund Trader Alert

More than two-thirds of adult Americans are overweight. By 2015, the number of overweight and obese people in the world is estimated to reach 3 billion.

A growing number of them are doing something about it -- as well as exercising more, dieting and eating better. That’s where Weight Watchers International (WTW), the world’s leading provider of weight-management services, comes into play.

It operates through a global network of company-owned and franchise operations. Weight Watchers already does business in 11 countries and it is expanding internationally.

U.S. News & World Report recently published its first-ever Best Diets rankings and Weight Watchers was ranked first among 20 different diet programs.

Many competitors are struggling, but not Weight Watchers, which emphasizes healthy eating, physical activity, behavior change and a support network.

Earnings are rising sharply, up 57% in the past year on a 25% increase in revenue. Over the last 12 months, customers have spent more than $1.8 billion on Weight Watchers’ branded products and services.

With more than four decades of weight management experience, Weight Watchers is among the most recognized and trusted brand names in the business.

The company recently has launched a powerful new marketing campaign and started an extensive public relations initiative to highlight new program innovations.

And, despite being around for almost 50 years, Weight Watchers is only just beginning to specifically market to men. As a spokesman, it is using former NBA great Charles Barkley. Barkley may do for Weight Watchers what William Shatner did for Priceline.

Enrollment is rising and now is the time to get aboard, before the next earnings report comes out next month. Typically, the first three months compose the biggest diet quarter of the year.

Weight Watchers probably will blow away the projected earnings numbers, just like the company did last April. Let’s buy WTW.

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Tags: WTW
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