FITBIT ($14.40) We added Fitbit in March at $14.55, so it is down about 1% at the moment as we write this. The stock obviously has done nothing and we’re afraid this may be the case in the future. There is a class action lawsuit currently in the works against the company, saying that its PurePulse heart-rate monitor technology is inaccurate. (Ouch.) Plus there are much cheaper knockoffs, not to mention Apple’s Watch, that are starting to chip away at Fitbit’s dominance in the wearable space.
But the big fear for us is that consumers are starting to lose interest in the novelty of wearable activity monitors. And most of the Fitbit owners have no need to buy another one. And dig this: It appears that 35% to 45% of fitness tracking watch owners stop using them within a few months of acquiring them. This hurts.
BMR Take: I think you can guess how we feel now. We are going to remove Fitbit from our Special Opportunities Portfolio. There aren't any real growth projections that we can wrap our arms around. We took a shot and the stock is down only 1%. It didn’t work out but we didn’t lose any money.
Note: Some of our subscribers have asked if we have positions in the stocks in our portfolios. Answer: We do not.Â