Vitamin/Supplement Investors Need to Brace for New Documentary (VSI) (GNC) (WFM) (NGVC) (TFM)

Piper Jaffray analyst Sean Naughton is warning investors in the Supplements/Vitamin sector to brace for volatility ahead of a new documentary highlighting the supplements industry.

The new documentary "Supplements and Safety" which is set to air on January 19th on PBS likely brings additional negative media attention to the category, he warned.

According to the PBS website the new documentary "investigates the hidden dangers of vitamins and supplements...and how it's often hard to know what's really in the bottles you buy."

"We believe this negative media attention could be a further headache for vitamin/supplement (VMS) sales as our survey work has shown roughly 33% of VMS buyers are influenced by negative media reports," Naughton said.

At the top of the list is The Vitamin Shoppe (NYSE: VSI) with the vast majority of its sales in the vitamin and supplement category, the analyst warns.

Additionally, the specialty grocers are also a big seller of vitamin/supplement products. VMS represents approximately 23% of Natural Grocers' (NYSE: NGVC) sales (31% of SKUs) and 27% of Sprouts Farmers Market (NASDAQ: SFM) SKUs on shelf. They estimate Whole Foods Market (NASDAQ: WFM) has a lower exposure, but is likely a double digit percentage of sales.

GNC Holdings (NYSE: GNC) was not mentioned in the report but it too could see volatility.

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