Latest news with #PTON
Business Insider
4 days ago
- Business
- Business Insider
Peloton Interactive (PTON) Comeback Falters as Sluggish Revenues Take Their Toll
Peloton Interactive (PTON) appeared to be mounting an impressive recovery through 2024 and into early 2025, with the stock climbing more than 170%. However, recent setbacks have put that rebound in doubt, as shares have fallen 23% year-to-date. Elevate Your Investing Strategy: Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence. Given the growing operational headwinds and weakening fundamentals, it's difficult to make a compelling case for owning the stock—even at what might seem like a reasonable valuation. I remain Bearish until Peloton demonstrates evident progress in subscriber growth and a path to sustained profitability. Peloton's Rise and Repeat During the darker days of the COVID pandemic, as we collectively turned to home-based activities, companies like Peloton were there to meet consumer demand. At its peak, the company grew to one of the world's largest interactive fitness platforms, serving over 6 million members, and reached a $50 billion valuation with shares trading above $150. However, as we know, expectations for a permanent shift to home-based activities quickly gave way to a resumption of normalcy as the world emerged from the pandemic. Demand for Peloton crashed as consumers returned to gyms and low-cost competitors flooded the market. By early 2024, its shares had lost 97% of their value. The company transitioned under new management, which implemented aggressive cost-cutting measures, refined its debt structure, and shifted its focus from hardware sales to higher-margin subscription revenue. These efforts showed promising results, as Peloton posted its first sales increase since 2021, partnered with Costco for retail distribution, and the stock rebounded. However, cracks have begun to appear in the recovery narrative. Recent quarterly results show revenue decline, with sales dropping 13% year-over-year while competitors have posted modest growth. More concerning, the subscriber base has stagnated at roughly 3 million fitness subscriptions, suggesting the company's growth engine has stalled. Heading the Wrong Direction and subscription revenue appears to have plateaued at roughly $1.7 billion annually, as churn rates remain elevated. According to TipRanks data, PTON has reduced its operating expenses by 25% year-over-year, significantly improving its cost structure. Yet, capital expenditures have plummeted from over $300 million annually to just $11.3 million, reflecting a company in survival mode rather than one investing in growth. Peter Stern's addition as CEO initially generated optimism, given his background with subscription services at Apple and operational experience at Ford. His initial strategy of prioritizing profitability over growth seemed reasonable given Peloton's financial constraints. Yet, recent insider activity raises questions about management's confidence in the turnaround. Multiple senior executives, including the Chief Financial Officer, have sold significant blocks of shares, which typically signals a skeptical view of near-term prospects. Valuation Not a Safety Net Peloton faces intensified competition for a total addressable market that appears to have stabilized at levels well below pandemic peaks. Tech giants Apple (AAPL) and Amazon (AMZN) continue to expand their fitness offerings with integrated ecosystems and deeper pockets. In contrast, traditional fitness equipment manufacturers like NordicTrack and Tonal have enhanced their connected offerings. Despite trading at seemingly reasonable valuation metrics, with a price-to-sales ratio of 0.98x that is in line with sector averages, the stock's negative price momentum is concerning. Additionally, the stock trades bearishly below all major moving averages, suggesting that its current valuation may continue to trend downward. Finally, an elevated short interest of roughly 18% of outstanding shares reflects widespread skepticism about the company's prospects and weighs on its valuation. Is PTON a Good Stock to Buy? On Wall Street, PTON stock carries a Moderate Buy consensus rating based on four Buy, seven Hold, and zero Sell ratings over the past three months. PTON's average stock price target of $8.06 implies ~19% upside potential over the next twelve months. While still somewhat optimistic, analysts' views of the stock have grown increasingly cautious. For example, Bernstein, UBS, and Citi have recently reiterated Hold ratings on the shares following disappointing recent results. Still, the company has its fans. Bank of America's Curtis Nagle believes that several potentially positive catalysts are not currently reflected in the shares' price, and he maintains a Buy rating with a $9.50 price target. Meanwhile, Susan Anderson from Canaccord Genuity recently reiterated a Buy rating on the shares with a price target of $10, noting the company's launch of a new marketplace for refurbished equipment that aims to tap into the second-hand market. This could provide a new revenue channel while encouraging existing users to upgrade their equipment. PTON Lacks Pace in a Crowded Field While Peloton's cost-cutting efforts have had a positive impact, operational improvements alone cannot overcome structural market challenges. Revenue decline has resumed, subscriber growth has stalled, and competitive pressures continue to mount, with no clear differentiation strategies in place.
Yahoo
03-07-2025
- Business
- Yahoo
3 Volatile Stocks with Open Questions
A highly volatile stock can deliver big gains - or just as easily wipe out a portfolio if things go south. While some investors embrace risk, mistakes can be costly for those who aren't prepared. At StockStory, our job is to help you avoid costly mistakes and stay on the right side of the trade. Keeping that in mind, here are three volatile stocks to steer clear of and a few better alternatives. Rolling One-Year Beta: 2.54 Started as a Kickstarter campaign, Peloton (NASDAQ: PTON) is a fitness technology company known for its at-home exercise equipment and interactive online workout classes. Why Should You Sell PTON? Number of connected fitness subscribers has disappointed over the past two years, indicating weak demand for its offerings Projected sales decline of 4.1% over the next 12 months indicates demand will continue deteriorating Historical operating margin losses point to an inefficient cost structure Peloton's stock price of $6.65 implies a valuation ratio of 7.8x forward EV-to-EBITDA. Check out our free in-depth research report to learn more about why PTON doesn't pass our bar. Rolling One-Year Beta: 1.24 Historically owning furniture, banking, and other subsidiaries, ArcBest (NASDAQ:ARCB) offers full-truckload, less-than-truckload, and intermodal deliveries of freight. Why Is ARCB Risky? Declining unit sales over the past two years indicate demand is soft and that the company may need to revise its strategy Falling earnings per share over the last two years has some investors worried as stock prices ultimately follow EPS over the long term Shrinking returns on capital suggest that increasing competition is eating into the company's profitability At $83.75 per share, ArcBest trades at 13.2x forward P/E. Dive into our free research report to see why there are better opportunities than ARCB. Rolling One-Year Beta: 1.07 With roots dating back to 1863 and a presence across 26 states primarily in the Midwest and West, U.S. Bancorp (NYSE:USB) is one of America's largest banks providing lending, deposit services, wealth management, payment processing, and merchant services to individuals and businesses. Why Is USB Not Exciting? Annual net interest income growth of 6.7% over the last four years lagged behind its bank peers as its large revenue base made it difficult to generate incremental demand Weak unit economics are reflected in its net interest margin of 2.8%, one of the worst among bank companies Large asset base makes it harder to grow tangible book value per share quickly, and its annual tangible book value per share growth of 1.3% over the last five years was below our standards for the bank sector U.S. Bancorp is trading at $47.55 per share, or 1.3x forward P/B. Read our free research report to see why you should think twice about including USB in your portfolio, it's free. The market surged in 2024 and reached record highs after Donald Trump's presidential victory in November, but questions about new economic policies are adding much uncertainty for 2025. While the crowd speculates what might happen next, we're homing in on the companies that can succeed regardless of the political or macroeconomic environment. Put yourself in the driver's seat and build a durable portfolio by checking out our Top 5 Strong Momentum Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025). Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-micro-cap company Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
28-06-2025
- Business
- Yahoo
Peloton (PTON) Rallies 6.4% on Quarterly Window-Dressing
Peloton Interactive, Inc. (NASDAQ:PTON) is one of the . Peloton Interactive rallied by 6.42 percent on Friday to close at $6.8 apiece as investors appeared to scoop up bargains ahead of the quarterly window-dressing. In recent news, Peloton Interactive, Inc. (NASDAQ:PTON) announced the creation of a chief technology officer role in line with its plans to focus on artificial intelligence innovation. The role will be assumed by Francis Shanahan, who has led the company's engineering and technical teams, customer-facing AI innovation strategy, guided product architecture, and ensured its systems are scalable and high-performing. In the third quarter of fiscal year 2025, Peloton Interactive, Inc. (NASDAQ:PTON) narrowed its net losses by 71.5 percent to $47.7 million from $167.3 million in the same period last year, pushing its nine-month losses down by 73 percent to $140.5 million from $521.4 million in the same comparable period. A group of people in a fitness class with connected fitness products in a studio or gym. Revenues for the last quarter declined by 13 percent to $624 million from $717.7 million year-on-year, while revenues for the nine-month period decreased by 8 percent to $1.883 billion from $2.056 billion. While we acknowledge the potential of PTON as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an extremely cheap AI stock that is also a major beneficiary of Trump tariffs and onshoring, see our free report on the best short-term AI stock. READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires. Disclosure: None. This article is originally published at Insider Monkey.
Yahoo
24-06-2025
- Business
- Yahoo
Peloton Interactive (PTON) Declines 11.2% W/W as 2 Execs Unload Stake
Peloton Interactive, Inc. (NASDAQ:PTON) is one of the . Peloton Interactive dropped its share prices by 11.2 percent week-on-week, from $6.96 on June 13 to $6.18 last Friday, following two of its executives' disposition of shares in the company. In separate regulatory filings, Peloton Interactive, Inc. (NASDAQ:PTON) said its chief finance officer, Elizabeth Coddington, and chief product officer, Nick Caldwell, sold a significant chunk of their stakes last week. Coddington, for her part, disposed of $269,322 worth of PTON stocks, covering 38,708 units at a price of $6.9578 apiece. Meanwhile, Caldwell sold worth $446,759, covering 63,925 shares at a price of $6.9888 apiece. Investors typically view insider selling negatively, especially when a company states no reason for the sale. In the third quarter of fiscal year 2025, Peloton Interactive, Inc. (NASDAQ:PTON) narrowed its net losses by 71.5 percent to $47.7 million from $167.3 million in the same period last year, pushing its nine-month losses down by 73 percent to $140.5 million from $521.4 million in the same comparable period. A group of people in a fitness class with connected fitness products in a studio or gym. Revenues for the last quarter declined by 13 percent to $624 million from $717.7 million year-on-year, while revenues for the nine-month period decreased by 8 percent to $1.883 billion from $2.056 billion. While we acknowledge the potential of PTON as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an extremely cheap AI stock that is also a major beneficiary of Trump tariffs and onshoring, see our free report on the best short-term AI stock. READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires. Disclosure: None. This article is originally published at Insider Monkey. Sign in to access your portfolio
Yahoo
15-06-2025
- Business
- Yahoo
Jim Cramer Recommends Spotify Over Peloton Interactive
Peloton Interactive, Inc. (NASDAQ:PTON) is one of the 15 stocks that Jim Cramer recently talked about. During the lightning round, a caller asked what Cramer thinks of Peloton Interactive, Inc. (NASDAQ:PTON), and he replied: 'Well, you know, it is a subscription business, and I like subscription businesses. I think that they work, but I don't think they have the growth. So, therefore, I'm going to say if you want a subscription business, I want you to be in Spotify.' A group of people in a fitness class with connected fitness products in a studio or gym. Peloton Interactive, Inc. (NASDAQ:PTON) provides connected fitness equipment and a digital platform that combines hardware, software, and content as it provides interactive workout experiences through various sales channels. During an episode of Squawk on the Street aired in March, Cramer mentioned the stock while appreciating subscription businesses. 'The fitness trend is good. Remember the fatness trend is battling with the fitness trend. But I would say that Peloton, Spotify, Netflix, Costco, subscription businesses. Subscription businesses are king. And Peloton's a subscription business. Well done… Peloton seems like it's got churn down. And I like that. That was a very good call. I thought the call was very good. Remember, I'm totally in this camp which just says, younger people want to workout.' While we acknowledge the potential of PTON as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock. READ NEXT: The Best and Worst Dow Stocks for the Next 12 Months and 10 Unstoppable Stocks That Could Double Your Money. Disclosure: None. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
