Despite a weakened economy and more conservative consumer habits, many Americans continue to lead a more active lifestyle and take fitness seriously around the country. The idea of living a longer and healthier lifestyle has always been popular, but has recently picked up steam. Faced with higher obesity rates, especially among the youth, consumers seem to be making more health-conscious decisions, such as taking part in local gyms, clubs, and outdoor activities.  Thus, we expect companies involved in this behavioral pattern to be well positioned to take advantage of this trend and use it as a profitability driver for the near future.

While many fitness clubs have seen a rise in memberships over the past few years, a survey conducted by Club Industry, a fitness research provider, has cited the number one reason for cancelled gym memberships to be high-membership costs. Considering the state of the economy, and the ongoing high unemployment rate, the result of the survey makes sense.

Companies such as Nautilus (NLS) should be able to capitalize on the current state of the industry. Nautilus provides health and fitness products for consumer home use. Some may recognize their line of Bowflex or Schwinn fitness products or have seen their TV advertisements. While the company discontinued its commercial sales segment in 2009, the increased focus on consumer sales has benefitted their Direct-To-Consumer segment. With second-quarter sales in this area up 10% over the previous year, management has indicated increasing demand in its more affordable line of cardio health-focused products to be one of the main drivers. Also, while supporting continued innovation, and emphasizing affordable pricing, prospects are looking up for Nautilus. We expect to see consumers take advantage of the company’s low-cost offerings, considering the more expensive alternative (in the long term) of retaining gym memberships.

Obesity has been a hot-button issue for the American public, both young and old. Even the government is seen taking action to help reduce obesity rates, citing higher health and medical costs related to the issue. Michael Bloomberg, the Mayor of New York City, has taken action to help rectify this problem by imposing a ban on soft drinks over 16 ounces, which should take effect starting March, 2013. A recent study conducted by the Trust for America’s Health and the Robert Wood Johnson Foundation projects a 60% increase in obesity rates in certain states through 2030. With increasing awareness of this health risk, consumers should be able to take the necessary steps to help educate, not just themselves, but their children as well. Companies, such as Nutisystem (NTRI) and Herbalife (HLF) provide weight management and fitness products such as nutritional supplements like protein shakes, as well as pre-packaged food programs for dieting customers. Nutrisystem has been offering a new pricing strategy to help offset internal costs while being able to maintain appeal for more price-sensitive customers. Herbalife, which has seen double-digit volume growth in each of its regions over the past few quarters, is rolling out automated sales centers with “24/7” access to their products. These offerings should please price–conscious customers and augur well for top-line growth for both companies.

The everyday healthy shopper continues to look for better alternatives when it comes to daily meals. The popularity of organic products has seen a spike over the past few years. Companies such as Whole Foods Market (WFM) have taken advantage of this growing trend.  As the largest natural and organic foods grocer in the country, with over 300 stores in 38 states, the company continues to be an attractive investment in an uncertain economic landscape. With Whole Foods continuing to open new stores, and with same-store sales climbing over the past few quarters, the company maintains a competitive edge over other traditional supermarket operators. Increasing obesity awareness and more health-savvy consumers should continue to be a revenue driver for this company. While some may see the increased use of organic foods as a fad, the Organic Trade Association has reported considerable sales increases over the past few years, with the sector surpassing the $30 billion mark for the first time in 2011, driven by consumer choice.

Also, Weight Watchers (WTW) has been taking advantage of a corporate trend in fitness. A provider of weight loss services, lifestyle changes and behavior modification through weekly classroom meetings, Weight Watchers is bringing its programs to corporations, both big and small. We expect its biggest gains to come from on-site meetings at the workplace, with more and more employers having a focus on improving employee health and lifestyle. The company’s online operations, its big-time money maker, have been yielding 90% gross margins, and its long-term prospects remain healthy as Weight Watchers continues to grow its big business offerings.

The increasing awareness of health implications related to unhealthy food choices, along with the motivation to decrease health costs and live longer and healthier lives should be taken seriously by consumers and investors alike. Companies offering viable at-home solutions to meet these goals are well-positioned to take advantage of these trends and turn them into to long-term revenue drivers. For a more detailed report, including comprehensive analysis and forecasts on the companies listed above, subscribers should examine our full-page reports in The Value Line Investment Survey.

At the time of this article’s writing, the author did not have positions in any of the companies mentioned.