Here at Compete we often talk about the predictive power of our data. We can often see trends in behavior and business performance before it is represented in financial statements. As someone who worked in the financial services community for a long time, I love looking at cases where Compete data can be related to the stock market.
Here are two companies I’ve been watching – Weightwatchers (Symbol: WTW) and Nutrisystem (Symbol: NTRI). The web has become a huge sales channel for both of these companies – so let’s take a look at their 12m web performance.
As you can see, Weightwatchers killed it in January, driving over 100% growth month-on-month in their unique visitors off of a large base. Nutrisystem also had a good January, driving a large amount of traffic (over 200% month-on-month) but off of a much smaller base. More importantly, Weightwatchers has significantly moved their year-on-year numbers – up over 76% over last year. In comparison, Nutrisystem has been basically flat.
Now let’s take a look at the stock market performance. The last 3 months have seen Weightwatchers significantly outperforming Nutrisystem.
And then there is today – where Nutrisystem announced that they had not hit the Street’s revenue expectations – and are now down -30%. Compete data showed us that they weren’t generating any significant year-on-year growth – and that was reflected in their revenue.
Now I wouldn’t argue that this is always going to work, nor would I argue that Compete data should be your only data source in terms of an investment. But tracking the web performance of many public companies, particularly those where a large percentage of their revenues are generated online, is a great input into your total investment picture on a company.
[Disclosure: Compete, Inc. has no financial interest in Weightwatchers or Nutrisystem. Damian Roskill has no position at this time.]
Damian Roskill is the Managing Director of Marketing at Compete. Before Compete Damian was head of products for a video start-up and has worked in start-ups for most of his career. Damian's career aspiration is to be at one with the advertising universe. Damian can be found on Twitter as Droskill, or connect with him on LinkedIn at http://www.linkedin.com/in/droskill