$WTW: Short the Barron's Bounce

Takeaway: This is a great opportunity to short WeightWatchers (WTW) following the expected ‘Barron’s Bounce.'

Mr. Market is offering investors a great opportunity to short WeightWatchers (WTW) following the expected ‘Barron’s Bounce’ this morning.

 

Shares of WTW were flashing green amid a sea of market red after the financial publication posted a bullish note over the weekend on the heels of our secular short call.

 

Hedgeye analysts Tom Tobin and Hesham Shaaban released a distilled dive video on Friday laying out our secular short thesis. We believe a game-changing technological paradigm shift is underway which is prompting new entrants into the space and undercutting WTW's price and value proposition. 

 

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Our Google Trackers suggest that interest in WTW services is decelerating meaningfully. Our estimates suggest that 1Q14 could experience the slowest sequential member increase in the last 7 years

 

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