In this year’s first quarter, Nautilus, Inc. (NYSE:NLS) realized a 15.5% growth in total sales, propelled by direct sales which increased by 26.4% to $42.6 million. Innovation in the fitness equipment that it sells is one of the strengths of Nautilus, Inc. (NYSE:NLS). Last year, the company introduced four new products, contributing to a $13-million increase in revenue for 2012.
Core strengths
For Life Time Fitness, Inc. (NYSE:LTM), one of the primers is the vast diversity of its clubs’ service offerings and its strong differentiation from other market players. Its offerings aren’t confined to club memberships and training sessions for individuals and groups, but also weight-loss programs and personal-care services, such as massage, hair, skin, and nail care. The company also operates more than 130 sports events and publishes an Experience Life magazine. It also partners with companies seeking to cut overall employee health costs.
Town Sports International Holdings, Inc. (NASDAQ:CLUB) offers the same partnership through its newly formed Fitcorp Private Fitness Division organized to manage private fitness centers for company clients. The company is also strengthening awareness of its brand via a clustering strategy focusing on easily accessible suburban locations in large metro areas. It is also adopting flexible club formats to allow for such specialized facilities like swimming pools and basketball courts, a tack which reduces capital and operating expense. This year, the company plans to add six clubs and 12 next year.
Life Time’s regimen looks supreme
Such projected expansion plans manifest the robust fundamentals going for the health-and-fitness industry, thus meriting investor consideration on taking an equity position in it. Zeroing in on the current valuations on these two industry players, Life Time Fitness, Inc. (NYSE:LTM) appears to have an edge over Town Sports International Holdings, Inc. (NASDAQ:CLUB) from an investing standpoint. Both currently trade with a one-year forward P/E ratio of 16. Nevertheless, Life Time Fitness, Inc. (NYSE:LTM) looks superior with its 10.91% trailing 12-month return equity and 14.75% projected five-year growth rate, levels that are tops in its industry.
The article Workout Picks to Build Your Stock Portfolio’s Muscle originally appeared on Fool.com and is written by Arturo Cuevas.
Arturo Cuevas has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Arturo is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.
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