In this article, we discuss 5 best fitness stocks to invest in. If you want to read about some more fitness stocks, go directly to 11 Best Fitness Stocks To Invest In.
5. DICK’S Sporting Goods, Inc. (NYSE:DKS)
Number of Hedge Fund Holders: 28
DICK’S Sporting Goods, Inc. (NYSE:DKS) operates as a sporting goods retailer primarily in the eastern United States. It is one of the best fitness stocks to invest in. The company recently announced a new partnership with fitness firm Peloton Interactive. Under the arrangement, the firm will sell the hardware products of the latter and select accessories via branded fitness shops inside more than 100 DKS US retail locations.
On August 24, UBS analyst Michael Lasser maintained a Neutral rating on DICK’S Sporting Goods, Inc. (NYSE:DKS) stock and raised the price target to $112 from $102, appreciating the second quarter earnings results of the firm.
Among the hedge funds being tracked by Insider Monkey, Washington-based firm Lone Pine Capital is a leading shareholder in DICK’S Sporting Goods, Inc. (NYSE:DKS), with 5 million shares worth more than $338 million.
In its Q1 2022 investor letter, Baron Funds, an asset management firm, highlighted a few stocks and DICK’S Sporting Goods, Inc. (NYSE:DKS) was one of them. Here is what the fund said:
“DICK’S Sporting Goods, Inc. (NYSE:DKS) was the first stock Michael recommended to us shortly after he joined Baron Capital in 2003. Dick’s share price has since increased about nine-fold. Unfortunately, we sold our investment in Dick’s about six years ago and, although it was a successful investment, we did not realize the full benefit of Michael’s recommendation. We sold too soon because I was concerned that competition from internet retailers would have a permanent negative impact on Dick’s stores’ profitability. I was wrong. Dick’s stock price so far has about doubled after we sold…and its prospects have brightened!
We sold even though we considered Ed Stack, Dick’s Chairman and CEO, a terrific retailer, a great entrepreneur and a special person. Ed had built Dick’s from three bait and tackle stores his dad started into a uniquely positioned, nationwide chain of 730 sporting goods stores. In fact, Dick’s is now the largest nationwide sporting goods chain. Ed had purchased the three bait and tackle stores, the foundation of Dick’s business, from his dad. Ed’s mother loaned him the money to buy his dad’s stores! I’m not exactly sure what that signifies. But it may have something to do with Carl Icahn’s proclamation that “everything I have is for sale except my children…and maybe my wife (…read more)
4. Skechers U.S.A., Inc. (NYSE:SKX)
Number of Hedge Fund Holders: 31
Skechers U.S.A., Inc. (NYSE:SKX) designs, develops, markets, and distributes athletic footwear for men, women, and children, as well as performance footwear for men and women worldwide. It is one of the top fitness stocks to invest in. Skechers USA shares have popped up recently after an SEC Filing showed that Michael Greenberg, the president of the firm, had bought 103,000 shares of the company, taking his ownership to 447,000 shares.
On July 27, Wedbush analyst Tom Nikic maintained an Outperform rating on Skechers U.S.A., Inc. (NYSE:SKX) stock and lowered the price target to $42 from $48, noting that the company reported slightly better-than-expected Q2 results.
At the end of the second quarter of 2022, 31 hedge funds in the database of Insider Monkey held stakes worth $830 million in Skechers U.S.A., Inc. (NYSE:SKX), compared to 28 the preceding quarter worth $893.5 million.
In its Q1 2022 investor letter, Fiduciary Management, an asset management firm, highlighted a few stocks and Skechers U.S.A., Inc. (NYSE:SKX) was one of them. Here is what the fund said:
“Skechers U.S.A., Inc. (NYSE:SKX) is the third largest footwear brand in the world. The company designs, manufactures, and distributes footwear for men, women, and children in U.S. and international markets. Its products cover a wide range of footwear categories including casuals, dress casuals, sandals, boots, work boots, performance footwear, and kids footwear. The company operates in three business segments: Domestic Wholesale (23% of sales), International Wholesale (48% of sales), and Direct-to-Consumer (29% of sales). In total, international sales account for approximately 60% of revenue…(read more)
3. Peloton Interactive, Inc. (NASDAQ:PTON)
Number of Hedge Fund Holders: 39
Peloton Interactive, Inc. (NASDAQ:PTON) operates interactive fitness platforms in North America and internationally. It is one of the elite fitness stocks to invest in. On September 21, Citi analyst Ronald Josey reiterated a Buy rating on Peloton Interactive, Inc. (NASDAQ:PTON) stock with a $23 price target, highlighting that the company announced the launch of a new home-rower machine and rolled out a series of software updates in the past few weeks.
Among the hedge funds being tracked by Insider Monkey, Chicago-based investment firm Citadel Investment Group is a leading shareholder in Peloton Interactive, Inc. (NASDAQ:PTON), with 20 billion shares worth more than $12.7 billion.
In its Q2 2022 investor letter, Rowan Street Capital, an asset management firm, highlighted a few stocks and Peloton Interactive, Inc. (NASDAQ:PTON) was one of them. Here is what the fund said:
“Peloton Interactive, Inc. (NASDAQ:PTON) has been a costly mistake for the fund thus far. We started a small position back in September of 2020 and added to it as the stock declined and the price got “cheaper and cheaper”.
We would like to walk you through the rationale why we bought the stock in the first place and why we added to the position. We will give you just a short summary in the main body of the letter, and for those who are interested in a more detailed version, we have included a write-up on Peloton in the Appendix at the end of this letter.
The trial is still out whether we made a mistake on the company, but we definitely made the mistake on the weighting of our position and the price that we originally paid…(read more)
2. DexCom, Inc. (NASDAQ:DXCM)
Number of Hedge Fund Holders: 56
DexCom, Inc. (NASDAQ:DXCM) is a medical device company that focuses on the design, development, and commercialization of continuous glucose monitoring (CGM) systems. It is one of the elite fitness stocks to invest in. The firm recently said that the Dexcom G7 continuous Glucose Monitoring system was available for people with diabetes aged two years and older in the UK, Ireland, Germany, Australia, and Hong Kong. The company is also working to launch the G7 in New Zealand and South Africa.
On July 29, Oppenheimer analyst Steven Lichtman maintained an Outperform rating on DexCom, Inc. (NASDAQ:DXCM) stock and lowered the price target to $105 from $131, highlighting that the company post-earnings selloff was a buying opportunity for the investors.
At the end of the second quarter of 2022, 56 hedge funds in the database of Insider Monkey held stakes worth $1.1 billion in DexCom, Inc. (NASDAQ:DXCM), compared to 58 in the preceding quarter worth $1.5 billion.
In its Q2 2022 investor letter, Baron Funds, an asset management firm, highlighted a few stocks and DexCom, Inc. (NASDAQ:DXCM) was one of them. Here is what the fund said:
“DexCom, Inc. (NASDAQ:DXCM) is the leading provider of continuous glucose monitoring systems for patients with diabetes. The stock fell along with other premium valuation growth stocks, primarily on multiple contraction. Concern about price competition from Abbott Labs’ Libre product also played a role. Results for the first quarter were solid. Sales increased 22% organically, margins expanded 350 basis points, and the company maintained guidance for continued strong results.
An important new and revolutionary product, the G7, was approved and launched in Europe, and the company expects it to be approved in the U.S. soon. The product is 60% smaller, fully disposable, and designed for extended wear. We remain excited that CGM will become the standard of care for Type 1 diabetics and will be used extensively for Type 2 diabetics as well, which we think will be a major driver of continued sales and profit growth well into the future.”
1. NIKE, Inc. (NYSE:NKE)
Number of Hedge Fund Holders: 72
NIKE, Inc. (NYSE:NKE) designs, develops, markets, and sells athletic footwear, apparel, equipment, and accessories worldwide. It is one of the most prominent fitness stocks to invest in. The company has been making efforts to clear excess inventory. During the first fiscal quarter, the firm saw its inventory soar 44% to $9.7 billion as it took holiday supplies early and bounced back from some of the pandemic-related supply chain issues of the last two years.
On September 30, Jefferies analyst Randal Konik maintained a Buy rating on NIKE, Inc. (NYSE:NKE) stock and lowered the price target to $115 from $130, noting that supply chain, foreign exchange, and promotional-related headwinds weighed on fiscal Q1 performance.
At the end of the second quarter of 2022, 72 hedge funds in the database of Insider Monkey held stakes worth $3.3 billion in NIKE, Inc. (NYSE:NKE), compared to 67 in the preceding quarter worth $3.98 billion.
In its Q2 2022 investor letter, Madison Funds Management, an asset management firm, highlighted a few stocks and NIKE, Inc. (NYSE:NKE) was one of them. Here is what the fund said:
“NIKE, Inc. (NYSE:NKE) is the largest seller of athletic footwear and apparel in the world. Started from humble beginnings as Phil Knight’s “crazy idea” in a Stanford entrepreneurship class, Nike marked its 50th anniversary this year. By remaining true to its innovative culture, the brand is as strong as ever and continues to generate attractive growth, soon to surpass $50 billion in annual revenue. In addition to the continuous investments in brand innovation and marketing, over the last few years Nike has invested heavily to lay the foundation for multi-channel commerce. Today, Nike generates approximately 40% of its revenues through its online channel and branded storefronts. Empowered by CEO John Donahoe’s “Nike Consumer Direct Offense,” Nike’s ongoing investments are expected to further drive their overall revenue mix towards the direct-to-consumer channel which we estimate will result in substantial margin improvement over the next three to five years.
While Nike’s business in China, which accounts for approximately 20% of revenue, is experiencing challenges today, our due diligence suggests that consumer preference for the Nike brand outside the U.S. remains incredibly strong. Overall, we expect Nike’s broader ecosystem, often referred to as the Nike Marketplace, to continue to leverage the company’s innovation and premier brand to build direct consumer relationships which deepen Nike’s competitive moat and enhance its financial profile. Turbulence in the Chinese market and concerns over consumer spending in the US and Europe enabled us to initiate a position in Nike at an attractive discount to our appraisal of the company’s long-term value.”
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