If you’re prone to inflating that spare tire around your waist, ’tis the season.Americans, who typically consume about 17 teaspoons of sugar a day,
gain on average up to two pounds between Thanksgiving and New Year.
After all, who can resist a second serving of sweet potatoes casserole (400 calories), a glass of creamy eggnog (440 calories) or a rum-laden piece of fruitcake (92 calorie)? Okay.Scratch the latter.No one really likes fruitcake.But you get the drift.
The good news? Resistance is no longer futile.Well-meaning weight watchers who can’t say no to shortbread now have a mighty weapon: Ozempic and others of its ilk.
And we’re gobbling up these weight loss meds.
In the waning months of 2022 alone, doctors wrote nine million prescriptions for the innovative wonder drugs.
You read that right: Three percent of the U.S.
population began taking them in just one 90-day period.If the trend continues –
and with obesity plaguing a whopping 42 percent of Americans – well, you do the math.
Meanwhile, from an investment perspective, the drugs have a different kind of effect.
They could potentially bulk up the worth of some companies while putting the profits of other ones on a diet.
A plus-size subtraction?
For example, Torrid (
CURV) possibly stands to lose – but not in a good way as Americans shed their weight.This maker of plus-size apparel for women, which became profitable in 2023, doesn’t report on Q3 until next week.But in the second quarter, net sales fell by over 18 percent and its profit margin was down, too.
Is any of this directly attributable to the skyrocketing use of diet meds? Hard to say, with inflation still a factor affecting purchasing decisions.But the weight loss trend is bound to impact the company eventually unless it evolves to serve a changing market.
A cure for what addicts you
Another consideration? The new breed of weight loss medication seems able to treat a wide range addictions, including those to nicotine and alcohol.So businesses that exist to treat stubborn dependencies could potentially take a hit, too.
One such firm is Indivior (
INDV), an enterprise developing therapies for cannabis use disorder.True, its Q3 results showed a 17 percent revenue gain over last year’s performance.But its share price has fallen 26 percent since the second quarter and the firm is still not profitable.
It also
just forked over $385 million in an anti-trust settlement, So as weight loss pharmas steal its thunder with anti-addiction products already in the market, it could be vulnerable.On the other hand, Indivior’s earnings are still predicted to grow by nearly 60 percent next year, so as a short-term gamble it might be a reasonable bet.
A quick pivot from a diet firm
Meanwhile, who stands to gain as Americans lose their poundage? One surprise contender is WW International, Inc.
(
WW), which you likely know as Weight Watchers.You’d think a firm that hawks prepared diet dinners would be on the ropes.And the company did post a more-than expected decline in revenue in Q3.
Still, its prospects are looking solid because its has been quick to adapt and act.
It recently acquired the digital health company Sequence, which offers telehealth services with doctors who can prescribe Ozempic, Wegovy and other weight-loss medications to clients who pay $99 a month for the service.
New kids on the block
Next, there’s Eli Lilly (
LLY).This month, the FDA approved its drug Zepbound for treating obesity and for use in others who are overweight.
The big news here is that Zepbound will cost about $1,059.87, some 20 percent lower than other weight loss injectables.
What’s more, the drug firm has a stage two trial underway for another weight loss medication taken orally.If it gets approval, that could substantially bring down the cost of obesity treatment.
Investors are bullish on the firm;
its shares have climbed 60 percent this year and some analysts are calling the stock a buy.
Diet drinks iced?
Finally, companies that feed our craving for sweet stuff are watching the uptake of weight loss drugs with trepidation.Coca Cola (
KO) is one of them.Last month, CEO James Quincey admitted he was “very focused” on the impact those drugs could have.
While most Coke products are now low- or no-calorie, ironically, that leaves them open to a plummet in sales.
After all, who needs diet drinks when your brain can stop you from consuming too much sugar?
So far, however, the soft drink giant is weathering the storm.
Net income was $3.1 billion in Q3, up nine percent from the same period last year.
A final thought: Prozac and Viagra can step aside when it comes to paradigm-shifting substances.
The weight loss concoctions stand to revolutionize every aspect of our lives..
