Weight Watchers – Potential?

Popular health company Weight Watchers (WW) has undergone significant changes, resulting in tremendous growth and recognition throughout the industry. Due to a successful rebrand, where Weight Watchers transitioned from a fat-loss company to a comprehensive wellness provider, WW might garner the potential investors crave.

Since the rebrand, WW have steadily increased their earnings and share value. Subscriptions have steadily risen (approximately 40%), along with a near 22% increase in EPS. As a matter of fact, the EPS figure greatly exceeds most of the prior market estimates for a company well-established in the health and weight loss services industry. The stock market has not been at its best due to industry turbulence, and most market estimates deemed a slight fall in EPS was most expected. Needless to say, this hasn’t happen at all.

Since the start of August 2019, Weight Watchers stock rose to over $30 a share. A massive 50% increase, this figure is largely dependent on consistently increasing subscription rates. WW subscriber rates reached its apex this year, thanks to worldwide support of their health and wellness initiatives. Even Oprah Winfrey felt obliged to support their wellness philosophy, and WW will hope to continue its momentum in rising subscription rates. As of 2019, WW has experienced over a 1% increase in subscription rates in comparison to last year. For 2020, WW remains hopeful towards similar numbers.

This might look very promising when analysing the numbers. Yet, there is and still remains potential instability in the stock market thanks to both macroeconomic changes (negative interest rates anyone?) and political transition. However, WW aims to be there to provide some solace for potential subscribers in keeping hopeful, healthy, and happy.

For interested investors, the question arises. Does WW have the standing to remain positive regardless of any monetary or economic circumstances? Can Weight Watchers actually become immune to changes in the UK economy?

A potential shining light might come when investors consider WW as a past-undervalued stock that has more potential. After all, people still want to be happy and healthy no matter the circumstances in the country. But it can also be safe to assume that WW has reached its pinnacle, whereby potential economic and political factors will manage to undermine WW stock.

For now, the wellness industry might not be one to overlook. Weight Watchers has become a go-to source for individuals looking for a change in lifestyle and health. Weight Watchers continues the path to ensuring that subscribers experience both the psychological benefits that comes with a healthy living- beyond simply looking fitter in your clothes. Will investors be confident that new subscribers will join WW in the hopes to be happy in what seems to be a turbulent period in UK politics?

Eddie B.