Market Overview

Goldman Sachs Downgrades Peloton After 458% Gain, Shipping Delays

Share:
Goldman Sachs Downgrades Peloton After 458% Gain, Shipping Delays

One notable analyst is downgrading the exercise biker maker's stock after a 458% gain.

The Peloton Analyst: Goldman Sachs analyst Heath Terry downgraded Peloton Interactive (NASDAQ: PTON) from Buy to Neutral with a $140 price target.

The Peloton Thesis: “We continue to believe in the long term opportunity and Peloton and expect that the current pandemic will continue to both accelerate and steepen the adoption curve for the company’s leading connected fitness products," Terry wrote in a note.

Terry said Peloton has outperformed and trades near the price target of $140 “ahead of our expected timeline.” Shares of Peloton are up 458% since Terry added a Buy rating in October 2019, compared to a 14% gain for the S&P 500 over the same time.

Peloton recently began notifying customers about shipping delays, which Terry said gives risk to guidance. Shipping delays are coming from congestion at the Port of Los Angeles.

“Given the backlog of orders, the launch of Bike+," the analyst wrote, "and efforts at increasing production, we expect the company to report 276k net adds, above their guidance of 229k-239k.”

Related Link: Peloton CEO Says Apple Fitness+ Legitimizes Exercise Market

Terry is estimating revenue to hit $829 million for the first quarter versus guidance of $720 million to $730 million.

Peloton is spending less on advertising due to the strong backlog and shipping delays, which Terry said “should contribute to profitability above their guidance for the quarter.”

Peloton spent $23.1 million, $11.5 million and $7.7 million on media spending in January, February and March, respectively. The company did not spend more than $1 million a month on media spending a single month since until September with $1.1 million.

PTON Price Action: Shares of Peloton are down slightly Thursday to $123.21.

Latest Ratings for PTON

DateFirmActionFromTo
Nov 2020Exane BNP ParibasInitiates Coverage OnOutperform
Nov 2020RosenblattMaintainsBuy
Nov 2020UBSMaintainsNeutral

View More Analyst Ratings for PTON
View the Latest Analyst Ratings

 

Related Articles (PTON)

View Comments and Join the Discussion!

Posted-In: Bike+ Goldman Sachs Heath TerryAnalyst Color Downgrades Price Target Top Stories Analyst Ratings Best of Benzinga

Latest Ratings

StockFirmActionPT
SUNWells FargoDowngrades26.0
TRPWells FargoDowngrades67.0
PNCStephens & Co.Downgrades
BKEPWells FargoUpgrades2.0
DCPWells FargoUpgrades21.0
View the Latest Analytics Ratings
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Premarket Activity
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Fintech Focus
A daily collection of all things fintech, interesting developments and market updates.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at vipaccounts@benzinga.com