Peloton Bike
Courtesy of Peloton
Peloton Interactive is set to report fiscal third-quarter results after the market closes on Thursday. Investors will be looking ahead to see if the at-home fitness firm can top last summer’s pandemic-fueled run.
Peloton stock (ticker: PTON) was up 0.9% to $96.70 on Tuesday, while the S&P 500 index was down 0.7%. The stock has declined 43% from its peak levels around the start of the new year. As vaccines rolled out and U.S. states loosened Covid-19 restrictions, investors turned away from highflying pandemic plays like Peloton in favor of beaten-down value stocks.
Last month, Peloton stock fell after the Consumer Product Safety Commission warned that the company’s treadmills were dangerous around small children and pets, urging those with children at home to stop using the product. The company called the update misleading, adding that its treadmill is safe when used according to instructions. Regardless, Peloton stock fell sharply on the news and hasn’t bounced back.
For the fiscal third quarter, Wall Street analysts expect Peloton to report a net loss of 12 cents a share, with sales hitting $1.12 billion. Analysts anticipate Peloton’s connected fitness subscriber base grew to 1.99 million, from 1.67 million at the end of the second quarter. Connected fitness subscribers pay $39.99 a month to access classes and features on Peloton equipment.
MKM Partners analyst Rohit Kulkarni wrote in a note on Tuesday that he expects investors to hone in on the company’s outlook for the 2022 fiscal year, as well as commentary on shipping delays and inventory availability, as well as updates on growth initiatives.
Still, he points to growing negative sentiment among investors for companies that saw accelerated growth during the pandemic, pointing to recent reactions to results from Pinterest (PINS) and Netflix (NFLX). Even if the company beats earnings expectations and raises its outlook, a slight miss on subscriber metrics could still send the stock falling, according to Kulkarni.
Write to Connor Smith at [email protected]
