The New Era of Wellness: Embracing Fitness Trends for Optimal Investments
Invest in Strengthening Your Finances by Capitalizing on Emerging Wellness Movements
People are no longer content with just existing—they want to thrive, and that's evident in the recent proclamation that "70 is the new 50." This bold statement didn't come from a beauty salon or yoga studio, but from the prestigious International Monetary Fund. Improvements in health and wellness have transformed those in their seventies into mentally and physically sharp individuals, similar to those in their fifties just a couple of decades ago.
This newfound focus on wellness shows no signs of slowing down, and it's not surprising that individuals of all ages are eager to spend their hard-earned cash on it. In fact, a recent survey revealed that wellness has surpassed almost every other category as the preferred purchase. Here are three astute investments that are poised to profit from the current wellness revolution:
Fitness Over Frills: The Gym Group
In the United Kingdom, more than 11 million individuals are members of a gym, and this is excellent news for low-cost fitness chain The Gym Group. Founded by former squash champion John Treharne in 2007, The Gym Group began with a single location in West London and has rapidly expanded to nearly 250 sites across the country.
From the beginning, Treharne had a clear vision: budget-friendly, no-frills gyms that offer clean, well-equipped spaces, friendly staff, and flexible membership plans. This strategy has remained consistent throughout the years. Members can join for as little as £14.99 a month, and the average prices are less than half those of pricier clubs and chains.
Despite the passage of time, the fitness landscape has evolved, with new members mainly joining through social media sites. When Will Orr joined as CEO in 2023, the business had lost its way, leading investors to lose confidence, and the shares to plummet below £1. Orr developed a growth strategy, centered on retaining members, attracting new ones, and expanding the chain while maintaining profitability.
The results for 2024 were encouraging, with sales rising 11% to £226 million, underlying profits up 24% to £48 million, and membership growing 7% to nearly 1 million. Crucially, financial returns are improving on new and existing gyms. Orr plans to open around 50 more gyms over the next three years, using cash reserves for funding. Brokers expect robust growth in sales and profits this year and next, making the shares appear undervalued at £1.40. Orr even recently invested £30,000 of his own money by purchasing 22,000 shares at £1.37—a testament to his faith in the future of The Gym Group.
The Joyful Journey of Camellia
Research has shown that moderate tea consumption can decrease the risk of heart disease, manage blood sugar levels, and boost immunity. Luckily for us tea lovers, the world's largest independent tea producer, Camellia, sources more than 100,000 tons of tea leaves annually from plantations in India, Bangladesh, and East Africa. You'll find Camellia's tea in nearly every British cup, as well as in markets worldwide.
In addition to tea, Camellia focuses on avocados and macadamia nuts—both of which have been linked to health benefits. Camellia's avocado estates are in Kenya, where production has skyrocketed to over 15 million tons in recent years. Furthermore, American and Japanese consumers adore macadamia nuts, using them in salads and confectionery.
Last year, Camellia appointed a new CEO, Byron Coombs, who has been offloading non-core businesses, improving the balance sheet, and focusing on growth. Dividends have been reinstated, with expectations of gradual increases. Although profits decreased compared to the previous year, Coombs plans to reveal an enhanced value proposition for shareholders soon. Camellia has a long-term outlook, and its selection of health-oriented crops aligns with global wellness trends. At £46, the shares are anticipated to deliver sustainable returns for long-term investors.
Nurturing the Aging Population: Target Healthcare REIT
One consequence of increased lifespans is the significant growth in the elderly population. The United Kingdom currently has around 13 million seniors, up from 10.4 million in 2013. However, many elderly individuals will grapple with issues like dementia and frailty in their later years. Target Healthcare REIT caters to senior citizens, providing care that allows them to enjoy their golden years rather than suffer through them.
Target Healthcare's journey began when founder Kenneth MacKenzie discovered that most care homes failed to offer private bathrooms. MacKenzie decided to create a solution and founded Target. Today, the company has 94 sites with 6,400 bedrooms, each featuring ensuite facilities. Target owns the properties and leases them to care home operators, primarily small businesses.
MacKenzie values welfare, and the results demonstrate his dedication. Rents are rising, profits are growing, and brokers predict a dividend of 5.88p for the fiscal year ending June. Target shares have climbed by more than 25% since Midas recommended them 18 months ago, but the price remains low, as assets have been independently valued at £1.12 a share. MacKenzie is eager to expand the business further, and recent takeover activity in the sector indicates that competitors are circling too. At 99p, the stock is a sound investment, and the near 6% dividend yield serves as an added attraction.
As we age, it's essential to invest wisely to secure our financial futures. These three shares effectively capitalize on current wellness trends and should provide sustainable returns for long-term investors. Happy investing!
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- The recent proclamation by the International Monetary Fund that "70 is the new 50" highlights the transformative impact of improvements in health and wellness on lifespans.
- The newfound focus on wellness shows no signs of slowing down, causing individuals to expend their hard-earned cash on health-and-wellness activities and products.
- In the United Kingdom, The Gym Group, a low-cost fitness chain founded by John Treharne, has greatly benefited from this wellness revolution with its budget-friendly, no-frills gyms.
- Camellia, the world's largest independent tea producer, stands to gain from global wellness trends as tea consumption has been linked to heart health, blood sugar management, and boosted immunity.
- Target Healthcare REIT, a company that caters to the elderly population by providing care with private bathrooms, can capitalize on the growth of the elderly population in the United Kingdom and has seen rising rents, profits, and dividends.
- To secure financial futures, it's vital for long-term investors to invest wisely in stocks like The Gym Group, Camellia, and Target Healthcare REIT, which capitalize on current wellness trends and offer sustainable returns.
