10 Best Fitness and Gym Stocks to Buy Now

2. Lululemon Athletica, Inc. (NASDAQ:LULU)

Number of Hedge Fund Holders: 45

Lululemon Athletica (NASDAQ:LULU) is an athletic apparel, footwear, and accessories company. Its operations are spread over the Americas, China Mainland, APAC, and EMEA. The company’s offerings are specifically designed for a healthy lifestyle, including a range of athletic activities. It also offers fitness-inspired accessories and apparel designed for being on the move.

The company’s fiscal Q3 2024 total revenue increased by 9%, or 8% in constant currency. China Mainland grew by 39% (36% in constant currency), while the Rest of the World grew by 27% (23% in constant currency). Lululemon Athletica’s (NASDAQ:LULU) consumer retention is high, giving it the opportunity to drive higher revenue per guest with increased newness in its assortment. The company is continuing to grow its membership program, currently standing at around 24 million members. The offers it makes to its members, including partner perks, members-only events, and early access, are the primary drivers of this growth.

The company’s unaided brand awareness stands at 36% in the US, allowing it to grow as it continues to open and optimize stores and launch new brand campaigns and activations. Lululemon Athletica (NASDAQ:LULU) ranks second on our list of the best fitness and gym stocks to buy now.

Middle Coast Investing stated the following regarding Lululemon Athletica Inc. (NASDAQ:LULU) in its Q2 2024 investor letter:

“I mentioned last quarter and higher above that I like buying quality stocks on sale. Lululemon Athletica Inc. (NASDAQ:LULU), the 2nd worst performer in the S&P 500 this year, qualifies. I published a full thesis on the stock before its most recent earnings, but the basics: the yoga pants and clothing company has had an amazing post-pandemic run that is approaching its end. Its growth in the US is slow/non-existent at the moment, but it is growing very fast in China and Europe. I think that international growth is likely to endure, and that its US slowness is likely to be temporary. Lululemon shares are not ‘cheap’, but they are on sale for an average price, and I think the company will grow faster than average over the next five years. I would be wrong if Lululemon is a fad gone bust, or faces a huge post-pandemic hangover as people get used to leaving the house more. We’ll see.”