In a new report, analysts at Citigroup noted how the worldwide obesity epidemic could affect companies that run related businesses.
According to the report, as obesity continues to negatively impact health, productivity and broad global economies, governments around the world should take a more proactive approach to dealing with the issue.
However, more aggressive anti-obesity policies could have major impacts on many companies. Citi discussed several company stocks, which are estimated to have over half of their revenue related to the theme of obesity.
Healthcare treatment of obesity and obesity symptoms is a growing segment of the healthcare field. Citi specifically mentioned ResMed Inc. RMD 1.96% in the report.
The company is largely focused on treating sleep apnea in the U.S. and Europe, but it has been expanding its presence in China and India as well. Analysts believe the company’s operations are tied closely to the obesity theme.
Food and beverage analysts pointed out the link between sugary drinks and obesity, and mentioned The Coca Cola Co KO 0.69% in the report.
They predict that new initiatives to combat obesity will affect the company’s product mix, but will not hurt its profits.
Meanwhile, organic and healthy food stocks such as WhiteWave Foods Co WWAV 3.33%, Hain Celestial Group Inc HAIN 1.04% and Boulder Brands Inc BDBD 0.53% could benefit from an increased awareness of the benefits of eating healthy food.
Traditional snack makers like Kellogg Co K 1.25%, Hershey Co HSY 0.89%, Mondelez International Inc MDLZ 1.41% and Campbell Soup Company CPB 1.81% could be negatively impacted.
Citi also specified that life insurance providers could be negatively impacted if the obesity issue continues to grow.
“Life insurers face the difficulty of not being able to change benefits provided in legacy contracts other than resetting the price for the entire book of business each year.”
In this respect, large life insurers such as Prudential Plc PUK 0.16%, Metlife Inc MET 0.54% and ING Groep ING 0.48% could be hit hard by the obesity epidemic.
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