Health and fitness companies focus on improving and maintaining physical well-being through products and services including gym memberships, fitness equipment, nutritional supplements and wellness programs.
Here we recommend five stocks from the Health and Fitness space with a favorable Zacks Rank to enhance your portfolio returns. Their favorable Zacks Rank indicates more upside in the near term. These are: Sprouts Farmers Market Inc. SFM, DexCom Inc. DXCM, Hims & Hers Health Inc. HIMS, United Natural Foods Inc. UNFI and GoodRx Holdings Inc. GDRX.
Health and fitness companies benefit from consistent demand on growing global awareness of health issues and the importance of physical fitness. This trend is supported by rising rates of lifestyle-related diseases and a growing emphasis on preventive healthcare.
The space’s growth is backed by diverse revenue streams, which include subscriptions, product sales and services, making it attractive to investors seeking long-term gains. Moreover, technological advancements, such as fitness trackers and wearable fitness devices, provide new opportunities for growth and drive further consumer engagement and revenue potential.
However, the market is highly competitive. Economic downturns can impact consumer spending on non-essential health and fitness products. Rapid changes in consumer preferences and health trends can make it challenging for companies to continuously lure customers.
The chart below shows the price performance of our five picks year to date.
Zacks Investment Research
Image Source: Zacks Investment Research
Sprouts Farmers’ focus on product innovation, emphasis on e-commerce, expansion of private label offerings and targeted marketing with everyday great pricing bodes well. SFM has been lowering operational complexity, optimizing production, improving in-stock position and updating to smaller-format stores. These efforts helped SFM post better-than-expected fourth-quarter 2024 results, wherein both top and bottom lines grew year over year.
Buoyed by the performance, Sprouts Farmers provided a decent 2025 view. SFM expects net sales to rise between 10.5% and 12.5% with comps anticipated to increase in the range of 4.5-6.5%. SFM’s strong sales growth, margin expansion and disciplined financial management position it as a compelling investment opportunity. SFM currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Sprouts Farmers has an expected revenue and earnings growth rate of 13.7% and 33.6%, respectively, for the current year. The Zacks Consensus Estimate for current-year earnings has improved 1.2% over the last seven days.
DexCom has benefited from an impressive contribution from the Sensor segment and domestic and international revenue growth have acted as the key catalysts. DXCM’s prospects with Stelo as an OTC monitor for type 2 diabetes bode well. DexCom made continued advancements concerning key strategic objectives and ended the quarter with new patient additions.
DXCM’s slew of tie-ups with AID systems is encouraging. A solid international foothold and robust product portfolio augur well. A strong solvency position is an added plus. DexCom currently carries a Zacks Rank #2 (Buy).
DexCom has an expected revenue and earnings growth rate of 14.3% and 23.2%, respectively, for the current year. The Zacks Consensus Estimate for current-year earnings remained same over the last seven days.
Zacks Rank #2 Hims & Hers Health addresses a vast unmet healthcare market, leveraging a $360M U.S. TAM across specialties like mental health, weight loss, and dermatology. HIMS’ personalized product offerings drive subscriber growth, with 2M+ subscribers contributing to rising recurring revenues. Targeting $100M from new categories by 2025, HIMS invests in GLP-1 weight-loss solutions, advanced tech, and compounding pharmacies to scale.
While new launches temporarily pressure margins, Hims & Hers focuses on efficiency and long-term profitability. Competing with players like Teladoc, HIMS differentiates through personalized care, proprietary tech, and vertical integration.
Hims & Hers Health has an expected revenue and earnings growth rate of 58.5% and more than 100%, respectively, for the current year. The Zacks Consensus Estimate for current-year earnings has improved 9.4% over the last seven days.
Zacks Rank #2 United Natural Foods has continued to demonstrate strong growth and operational discipline, supported by wholesale momentum and sustained demand for natural and organic products. UNFI’s strategic initiatives such as customer base expansion, network optimization, investment in automation, and adoption of lean management practices have driven notable gains in efficiency, cost savings and service quality.
UNFI raised its full-year fiscal 2025 outlook following solid second-quarter results. That said, challenges remain in the form of softness in retail, pressure on gross margins due to product mix and pricing strategies, and higher industry competition. UNFI’s continued focus on execution, digital capabilities, margin improvement and retail repositioning will be critical to sustaining momentum and long-term shareholder value creation.
United Natural Foods has an expected revenue and earnings growth rate of 1.9% and more than 100%, respectively, for the current year (ending July 2025). The Zacks Consensus Estimate for current-year earnings has improved 7.9% over the last 60 days.
Zacks Rank #2 GoodRx Holdings offers information and tools that enable consumers to compare prices and save on their prescription drug purchases in the United States. GDRX operates a price comparison platform that provides consumers with curated, geographically relevant prescription pricing, and access to negotiated prices.
GDRX also offers other healthcare products and services, including subscriptions and pharma manufacturer solutions, as well as telehealth services through the GoodRx Care platform. In addition, GDRX provides healthcare products and solution for dogs, cats, and other pets. GDRX serves pharmacy benefit managers who manage formularies and prescription transactions, including establishing pricing between consumers and pharmacies.
GoodRx Holdings has an expected revenue and earnings growth rate of 4% and 14.7%, respectively, for the current year. The Zacks Consensus Estimate for current-year earnings remained the same over the last 60 days.
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