Key Stats for Peloton Stock
- Price Change for $PTON stock: -3.7%
- Current Share Price: $8.67
- 52-Week High: $20
- PTON Stock Price Target: $13.73
What Happened?
Peloton (PTON) stock slipped nearly 4% on Wednesday despite the company announcing its biggest product overhaul since launching in 2012.
The connected fitness company unveiled its new Cross Training Series, which includes redesigned versions of its five main products: the Bike, Bike+, Tread, Tread+, and Row+.
The new lineup features upgraded hardware across the board, including better audio, faster processors, improved WiFi, and a 360-degree swivel screen.
The premium “plus” models feature AI-powered enhancements, including a movement-tracking camera that provides real-time form feedback, rep counting, and suggested weights during strength workouts. Members can also control the equipment hands-free using voice commands.
But these improvements come with steeper price tags.
Most hardware will cost $200 to $700 more than before. The base Bike now starts at $1,695 (up from $1,145 for refurbished or $1,495 for new).
The Tread+ jumps to $6,695 from $5,995. Subscription prices are also rising.
The All-Access membership will increase from $44 to $49.99 per month, App+ will go from $24 to $28.99, and App One will rise from $12.99 to $15.99.
Peloton also launched its Pro Series, a commercial equipment line designed for hotels, apartment buildings, corporate wellness centers, and country clubs.
This combines Peloton’s connected fitness experience with Precor, the commercial equipment company it acquired in 2020.
See analysts’ growth forecasts and price targets for Peloton stock (It’s free!) >>>
What the Market Is Telling Us About Peloton Stock
The decline in Peloton stock suggests investors aren’t convinced the product upgrades and price increases will drive the growth the company needs.
While CEO Peter Stern emphasized that the new equipment delivers “a lot more value” by combining cardio and strength training in one machine, Wall Street seems skeptical about whether consumers will pay hundreds more for these features.
Peloton has spent the last two years restructuring its business after nearly going bankrupt. The company refinanced its debt and returned to positive free cash flow, but sales have remained weak.
Now management is betting that better products can reignite growth heading into the crucial holiday shopping season, when Peloton sells over 60% of its annual hardware units.
The strategy focuses on cross-training, a practice that fitness enthusiasts are increasingly prioritizing.
Two million Peloton members now actively use the platform for strength training, not just cycling or running. The swivel screen addresses a longstanding complaint that the original equipment made it clunky to switch between workout types.
The commercial business could be a bright spot. It has already returned to year-over-year growth and is expected to account for a larger share of total revenue going forward.
Still, the price increases are risky, given that Peloton has struggled with the perception that its equipment is too expensive, and raising prices in a consumer environment that remains cautious could backfire.
Investors will be watching closely over the next few months to see whether the holiday season validates management’s bet that consumers will pay more for better products.
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
