Why This Peloton Interactive Analyst Is Bullish On The Market For Row

Zinger Key Points
  • "Peloton is targeting the high end of the rowing market given capabilities and price point," the analyst wrote.
  • The analyst estimates 600,000 incremental subscriber opportunity long-term for the company
Why This Peloton Interactive Analyst Is Bullish On The Market For Row

Peloton Interactive Inc PTON has finally launched its rowing machine, Peloton Row, which has been in development since 2019, and will be immediately available for pre-order in the U.S., with deliveries likely commencing in December, according to BofA Securities. It's the latest in a set of initiatives the company is taking to regain momentum.

The Peloton Interactive Analyst: Justin Post reaffirmed a Buy rating for Peloton Interactive, while keeping the price target unchanged at $19.

The Peloton Interactive Thesis: Peloton Row will be available at a starting price of $3,195, Post said in a note.

He's among a majority of analysts who are bullish on the stock, as Benzinga data shows a consensus Buy rating on PTON.

“Peloton is targeting the high end of the rowing market given capabilities and price point, and Peloton is probably unwilling to take a gross margin loss on the units given likely material sales overlap with existing Peloton subscribers,” the analyst wrote.

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“If we assume Peloton can penetrate 10% of 12mn U.S. rowers and a 50% rower/bike/tread overlap, we estimate 600k incremental subscriber opportunity long-term,” Post mentioned. “We also see opportunity for upside from potential international expansion and that some non-rowers may become interested in rowing,” he added.

“We expect modest Peloton Row contribution to FY23 subs,” the analyst further stated.

PTON Price Action: Shares of Peloton Interactive had declined by 1.24% to $9.53 at the time of publication Wednesday.

Posted In: BofA SecuritiesJustin PostAnalyst ColorReiterationAnalyst Ratings