Investing in Diet Stocks

Brian Hicks

Updated October 11, 2010

Nightmarish financial hardship, foreclosure-gate, and banking disasters aside… Wouldn’t it be nice to invest comfortably in fairly-run companies for a change?

Here’s one way to do just that.

Invest in the seasonal “fattening”

Every year, it’s the same old story.fat of the land

Americans — about 90% of them, according to Johns Hopkins Medicine — make their New Year’s resolution to lose weight, diet, and exercise more… which usually ends in passing the resolution on to the following year.

It’s a seasonal phenomenon that many of us are all too familiar with.  

And this year won’t be any different, as we head into the annual raking through of kids’ Halloween candy, watching football on Sundays in the company of beer and high-calorie chips and dips, the Thanksgiving spread, alcohol-fueled office parties, and the December holidays…

It’s “the most wonderful time of the year” when we begin to worry about our expanding waistlines, and promise ourselves that next year will be different.

It seldom is… But we’re not here to judge.

We’re here to make some money on the yearly fattenings.

Profit from the diet craze

You can profit by finding the diet stocks — like (DIET) — that historically run between October and the 1st of the New Year:

  • From about mid-December 2003 to the start of 2004, DIET ran from about $3.50 to about $6.50.
  • DIET ran from $3.25 to $5.35 from mid-December 2004 to the start of 2005.
  • It ran from $4.50 to about $8 between mid-December 2005 and January 2006.  
  • From mid-December 2006 to the start of 2007, DIET sold off after an early November 2006 run.
  • From November 2007 to December, DIET ran from about $4.50 to $6 before selling off to $2 in the months that followed.
  • From November 2008 to December 2008, DIET ran from a low of $2.50 to more than $4 before selling off.
  • And from November 2009 to January 2010, DIET ran from a low of about $1.10 to more than $2 (though, the chart wasn’t as impressive in previous years).

diet chart

Of course, the runs didn’t last beyond those time frames — quite possibly because the New Year’s resolution was pushed back another year.

And this year, we expect pretty much the same as DIET attempts to move on 2011 diet resolutions. That, and it doesn’t hurt that works with The Biggest Loser

This is a $50 million company — with no real debt — that’s positioned to capitalize on the seasonal end-of-year trend of pre- and post-holiday weight loss. 

And it’s not like they have a shortage of customers; DIET is operating with over a million members and almost six million pounds lost.

The Biggest Loser endorsement doesn’t hurt either… 

But to make money these days, diversification is key. It’s why we also recommend picking up a small amount of Nutrisystem (NTRI), Herbalife (HLF), and Weight Watchers (WTW). 

Each has put in some historic runs over these time frames as well; but DIET has more of a seasonal run history.

Just do me a favor if you buy… Never risk the house on these recommendations.

Not in this market. 

Stay Ahead of the Curve,

Ian L. Cooper
Wealth Daily

Angel Publishing Investor Club Discord - Chat Now

Brian Hicks Premium