Analysts Downgrade This Fitness Company Post Q3 Results

  • Analysts downgraded The Beachbody Co Inc BODY and slashed their price targets post Q3 disappointment.
  • Loop Capital analyst Daniel Adam downgraded to Sell from Hold with a price target of $2, down from $9, implying a 35% downside. 
  • The company's Q3 results were lower than expected. Its management reduced guidance for the year again. The analyst added that the "most alarming" component of the release was the free cash flow burn in the quarter. 
  • Adam further notes that Beachbody only has about 125 days of available liquidity at its current cash burn rate, or "enough to last until early February."
  • Baird analyst Jonathan Komp downgraded to Neutral from Outperform with a price target of $4, down from $11, implying a 30% upside. 
  • The analyst lowered his rating as Q3 results again missed expectations, and the company lowered 2021E guidance, prompting another sizable forecast reduction.
  • Guggenheim analyst John Heinbockel downgraded to Neutral from Buy with no price target. 
  • While he continues to believe in the long-term growth potential of the company's platform, he sees a more challenging near-term backdrop weighing on performance and would await greater visibility on what he expects to be an "eventual return to profitable growth." 
  • It is unclear how long temporarily tepid demand for at-home fitness services, higher-cost and less efficient media spending, and product delays will last.
  • Price Action: BODY shares traded lower by 16.1% at $3.085 on the last check Wednesday.
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