BofA Securities analyst Alexander Perry today writes about the prospects of wellness companies and how prioritizing healthy ways and increased wellness spending will bode for the companies’ stocks.

Younger generations, particularly Gen Z and millennials, are embracing healthier lifestyles, boosting wellness stocks, said the analyst.

This shift is evident in rising spending on fitness, activity-based leisure, and wellness products. Key trends include a surge in gym memberships, with Bank of America data showing fitness-related spending at a 19-month high.

Additionally, leisure activities like pickleball are gaining popularity, and interest in healthy eating, recovery, and non-alcoholic beverages continues to grow, the analyst noted.

Bank of America card data shows fitness center spending rose 7% year-over-year in February, marking the highest increase in 19 months.

Also Read: Ford Q1 US Auto Sales Dip 1.3%: Details

While all generations increased spending, Gen Z and millennials allocate a significantly higher portion of their budgets to fitness.

Gen Z households spend 2.8 times more than baby boomers on fitness, while millennials lead total spending, holding over 30% share. Higher-income consumers continue to drive this growth.

The wellness sector continues to gain traction, with healthy eating, recovery, and anti-aging trends driving growth. Non-alcoholic beer and seltzer spending has outpaced alcoholic alternatives by 28pts since 2021, while fitness club foot traffic has surpassed bars and pubs by 22pts.

Interest in cold plunges and red light therapy is rising, and pickleball participation has surged 46% year-over-year, reaching 20 million players, opined the analyst. The analyst’s top wellness picks are LTH, PLNT, & SN.

The analyst raised the price forecast for Life Time Group Holdings Inc. ( LTH ) to $45 from $40, reflecting its pricing power and strong membership demand.

The company is strategically positioned to benefit from rising wellness trends, including the expansion of pickleball and cold plunge offerings.

Meanwhile, Planet Fitness Inc. ( PLNT ) ($115 price forecast) is seeing accelerated same-store sales in the first quarter.

SharkNinja, Inc. ( SN ) is expanding its product line with the launch of the CryoGlow red/blue light therapy mask, noted the analyst. SN ($140 price forecast) is the analyst’s top wellness discretionary products pick.

Read Next:

• Why Is EV Battery Tech Provider Microvast Stock Surging Today?

Image via Shutterstock.