Wellness Stocks: The Next Big Thing?

The wellness industry is booming, and investors are taking notice. With younger generations embracing healthier lifestyles, spending on fitness, activity-based leisure, and wellness products is at an all-time high. According to BofA Securities analyst Alexander Perry, fitness-related spending reached a 19-month high in February 2025, with a 7% year-over-year increase. This trend is driven by higher-income consumers and is particularly pronounced among Gen Z and millennials, who 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.

But what does this mean for investors? Perry has identified several wellness-focused companies that are poised to benefit from this trend. Life Time Group Holdings Inc. (LTH) is one of his top picks, with a price forecast of $45. The company is strategically positioned to benefit from rising wellness trends, including the expansion of pickleball and cold plunge offerings. Planet Fitness Inc. (PLNT) is another top pick, with a price forecast of $115. The company 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, and Perry has a price forecast of $140 for the company.



But is this trend sustainable? Some analysts are skeptical. While the data shows a clear increase in wellness spending, there are concerns about the long-term viability of these trends. For example, the popularity of pickleball may be a fad, and the demand for cold plunges and red light therapy may wane over time. Additionally, the wellness industry is highly competitive, and new players are constantly entering the market, which could drive down prices and margins.



Despite these concerns, the wellness industry shows no signs of slowing down. The Global Wellness Summit's 2025 report highlights several key trends that are expected to drive growth in the coming years. For instance, the "Analog Wellness" trend predicts a growth in apps that help manage and limit screen time, as well as a continued growth of social analog hobby spots. The "Sauna Reimagined" trend points to a boom in saunas as social and entertainment hubs, driven by younger consumers seeking solutions to the loneliness epidemic. The "Supplement Paradox" trend indicates a growing demand for precise and premium supplements, thanks to biomarker-driven/test-to-treatment offerings and a focus on personalized efficacy.

In conclusion, the wellness industry is a hotbed of opportunity for investors. While there are risks and uncertainties, the data shows a clear trend towards increased wellness spending, particularly among younger generations. Companies that can capitalize on these emerging trends are likely to see significant growth in the coming years. But investors should approach this market with caution, and do their due diligence before making any investment decisions.