It took 50 years for the U.S. birthrate to top the baby-boom peak of 4. 3 million set in 1957 but it did so last year, based on preliminary...
It took 50 years for the U.S. birthrate to top the baby-boom peak of 4.3 million set in 1957 but it did so last year, based on preliminary figures released last month from the National Center for Health Statistics.
Demographers say the increase stems from such factors as improving fertility treatments, immigration and more teen pregnancies.
Financial analysts have been paying attention. Bespoke Investment Group last week introduced its “baby index,” a small group of stocks that could benefit from the birth surge.
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It would be a stretch to assign the term “new baby boom” to the recent trend. Stephanie Ventura, a demographer at the national center, notes all those babies in the 1950s were born to far fewer women: The number of women of childbearing age was about half what it is today. The baby boom lasted from 1946 to 1964.
But even a short-term surge in births can have a significant effect. Even in tough times, parents don’t like skimping on their kids, points out Bespoke’s Paul Hickey.
He says his picks should benefit “not only from the increase in population, but because of new products and themes.” For example, recent acquisitions by Natus Medical, a maker of testing equipment for newborn ailments, have boosted earnings, he says.
Martek Biosciences, a maker of nutritional supplements used in baby formula and food, is a “pure play” on trend toward health and wellness, writes Scott Van Winkle, an analyst at Canaccord Adams.
While Bespoke’s baby-centered selections as a group are topping the S&P 500 this year by a longshot, not all have been performing well. Kimberly-Clark recently lowered its earnings outlook due to higher material costs and Carters has been suffering from an overall weak retail environment.