Why Has Peloton Stock Gained 50% Over The Last Month?

Peloton (NASDAQ: PTON), a company that sells fitness equipment and related subscription services, has seen its stock rally by close to 50% over the last month, despite posting declines post its late-September IPO debut. The company currently offers fitness bikes attached with a connected iPad-like device, that start at about $2,000 and treadmills that start at about $4,000, along with paid subscription services that offer a variety of classes. The recent rally is driven partly by the company’s plan to introduce new products that could include a cheaper treadmill and rowing machine in 2020 while exploring bringing apps to the Amazon Fire TV and Apple Watch. Moreover, there have been indicators that the company was seeing strong traffic over Black Friday.

We ‘step back’ from these recent swings to review Peloton’s performance over the last few years, as a context for what might come next. Our Interactive dashboard, Why Peloton’s Stock Has Rallied Despite A Rough IPO Debut reviews the near term reasons and the big picture.

The context for the last few years:

A closer look At Peloton’s Total Revenues over the last few years and the outlook. 

Total Revenues for Peloton increased from $0.4 Bil in 2018 to $0.9 Bil in 2019, marking an increase of 110%, driven by soaring sales of Connected Fitness Products as well as subscriptions. This compares with Total Revenues growth of 99% in 2018. We expect Total Revenues growth to be 58% in 2020, driven by new product launches and higher subscription revenues.

A closer look At Peloton’s Total Expenses over the last few years and the outlook

Total Expenses for Peloton increased from $0.5 Bil in 2018 to about $1.1 Bil in 2019, an increase of 130%. This compares with Total Expense growth of 67% in 2018. We expect Total Expense growth to be 35% in 2020.

How does Peloton’s Revenue Growth compare with rivals?
For more information on how Peloton’s revenue growth compares with rivals, view our interactive dashboard analysis.

How has Peloton’s EBT trended?

EBT for Peloton decreased from -$48 million in 2018 to -$196 million in 2019, as Operating Expenses grew faster than Revenues. We expect EBT to increase to -$49 million in 2020.

How has Peloton’s Net Income and EPS trended?

For more details on Peloton’s Net Income, view our interactive dashboard analysis.


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