- UBS runs through the numbers on what the demand curve may look like for Peloton Interactive (PTON -1.7%) in a post-COVID world.
- Analyst Arpine Kocharyan and team say that based on the latest analysis of the total addressable market in the U.S., UK, Canada and Germany - Peloton would need to reach 7.7% penetration by FY24 to meet the firm's +38% CAGR expectation in Connected Fitness subscriptions for the time period from now until then. UBS estimates Peloton's penetration of the total addressable market at approximately 3.0% today vs. 1.5% in 2020 and 0.7% in 2019. UBS thinks that a potential problem for bulls is that Street estimates assume Peloton more than triples the penetration rate by 2025.
- The Seeking Alpha Value Grade on Peloton is also on the low side.
- UBS keeps a Sell rating on Peloton due to the high revenue marks implied by the current valuation. The firm's price target of $74 reps about 33% downside potential.
- Seeking Alpha author StockBros Research looks at the Peloton numbers differently, saying free cash flow CAGR of 28% justifies a bullish thesis.
Peloton Interactive valuation may be outracing demand - UBS
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Symbol | Last Price | % Chg |
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PTON | - | - |
Peloton Interactive, Inc. |