Fitbit, Inc.FIT recently expanded its partnership with Arizona-based Solera Health, in order to help people improve health culture and reduce type 2 diabetes.
Under the agreement, Fitbit will offer a health care platform to Solera members. The deal is aimed at improving care management among users through positive thinking and physical exercise, to name a few.
The program helps to reduce the risk of type 2 diabetes by helping them lose 5% of their body weight, improve diet and engage them in some type of healthy activity a week.
Their partnership dates back to 2017 when Solera offered Fitbit devices to individuals who used Solera network for enrolling in digital National Diabetes Prevention Program (DPP).
DPP is a nationally recognized care management model that is aimed at improving health outcomes through coaching and support.
The analysis showed that Fitbit devices played a meaningful role in improving health outcomes for participants in DPPs. The members who used a Fitbit device lost more weight and reported an extra hour of weekly activity than other participants. Thus, users who used Fitbit devices were highly benefited.
Recognizing the benefits of the partnership, Fitbit and Solera have further cemented their relationship, with Fitbit set to offer its latest activity trackers, Fitbit Inspire and Fitbit Inspire HR to Solera's DPP participants.
Growing Diabetes Market
Of late, the diabetic device market is expanding in leaps and bounds. The disease is on the rise and is no longer attributable to the rich nations only. Per a latest World Health Organization data, the global prevalence (age-standardized) of diabetes has nearly doubled since 1980.
Per a research report, more than 30 million of American adults are affected by type 2 diabetes annually. Direct medical expenses account for around $327 billion on an annual basis. Yet, the onset of the disease can be delayed or even prevented among the 84 million U.S. adults by taking proper care.
According to a Markets and Markets report, the global diabetes care device market is projected to reach $2.3 billion by 2020 and witness a CAGR of 6.3% during the period.
The recent partnership with Solera Health should help Fitbit gain share in the healthcare space.
Fitbit's prospects look bright since the company is focused on developing new features and services, increasing brand awareness, and expanding its global distribution & presence in the corporate wellness market.
Fitbit has been working with leading medical institutions, helping researchers overcome major challenges and engage patients in better ways. It provides its corporate wellness program to entities like self-insured businesses, boosting growth prospects.
The deal is inline with the company's strategy to expand its share in the healthcare sector and generate more recurring revenues.
In addition, the partnership will help Fitbit stay ahead of competitors like Apple AAPL and other players that have been focusing on the health care market. Notably, this partnership might prove appealing to others in the industry as well and expand Fitbit's customer base.
Fitbit, Inc. Price and Consensus
Zacks Rank & Stocks to Consider
Currently, Fitbit has a Zacks Rank #3 (Hold). Some better-ranked stocks in the broader technology sector include Expedia Group, Inc. EXPE and AMETEK, Inc. AME , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here .
Long-term earnings growth rate for Expedia and AMETEK is projected to be 13.4% and 9.6%, respectively.
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