Share price has dropped to $10.40 (after 2 for 1 split).
Some impact from tariffs on import of ingredients from China, albeit CEO says they made some anticipatory stock purchases ahead of tariff announcement.
Unfortunately, the world is in a state of flux. No one knows what the future holds with Mr Trump steering the US. His announcements are unpredictable and he is prone to changing his mind. He has already intimated that he is open to reaching deals with other countries, so will these tariffs endure for the long-term, or are they only a short-term negotiating tactic?
The problem is that with so much uncertainty about global trade, how is a company able to make strategic investment decisions or long-term contingency plans?
The answer is that they can't.
This means that most companies will take a wait and see approach. It will result in a moratorium on investment which is an impediment to growth. That will hurt every economy, the US included.
Best case scenario, Trump aborts the aggressive economic policy approach he has taken so far and everything returns to the way it was.
Worst case scenario, we are in for an awful four years until the next change of US administration.
The CEO of FitLife may have made some anticipatory inventory purchases ahead of the the tariff announcement, but how long will they last? He'll have to replenish his stock soon.
I think it is a time for defensive investing and to avoid companies with an exposure to imports in their supply chain because, as things stand, the cost of those will rise dramatically and eat into margins.
On a risk adjusted return basis, I think that there are better investment opportunities at present.
In a conversation with Dayton Judd, I dropped the question about whether M&A scope may be broadened to encompass opportunities in other sectors.
The response was both emphatic and encouraging, "Our focus is definitely on the supplement space for right now. There are a lot of opportunities, and we have the platform and expertise to absorb them without learning a new industry or dramatically expanding our team."
This suggests that acquisitive growth is certain to continue and that FitLife will continue to grow. This company ought to be seen as a consolidation machine within a niche industry.
Share price has dropped to $10.40 (after 2 for 1 split).
Some impact from tariffs on import of ingredients from China, albeit CEO says they made some anticipatory stock purchases ahead of tariff announcement.
Buying opportunity?
Unfortunately, the world is in a state of flux. No one knows what the future holds with Mr Trump steering the US. His announcements are unpredictable and he is prone to changing his mind. He has already intimated that he is open to reaching deals with other countries, so will these tariffs endure for the long-term, or are they only a short-term negotiating tactic?
The problem is that with so much uncertainty about global trade, how is a company able to make strategic investment decisions or long-term contingency plans?
The answer is that they can't.
This means that most companies will take a wait and see approach. It will result in a moratorium on investment which is an impediment to growth. That will hurt every economy, the US included.
Best case scenario, Trump aborts the aggressive economic policy approach he has taken so far and everything returns to the way it was.
Worst case scenario, we are in for an awful four years until the next change of US administration.
The CEO of FitLife may have made some anticipatory inventory purchases ahead of the the tariff announcement, but how long will they last? He'll have to replenish his stock soon.
I think it is a time for defensive investing and to avoid companies with an exposure to imports in their supply chain because, as things stand, the cost of those will rise dramatically and eat into margins.
On a risk adjusted return basis, I think that there are better investment opportunities at present.
In a conversation with Dayton Judd, I dropped the question about whether M&A scope may be broadened to encompass opportunities in other sectors.
The response was both emphatic and encouraging, "Our focus is definitely on the supplement space for right now. There are a lot of opportunities, and we have the platform and expertise to absorb them without learning a new industry or dramatically expanding our team."
This suggests that acquisitive growth is certain to continue and that FitLife will continue to grow. This company ought to be seen as a consolidation machine within a niche industry.