PreMarket Prep Stock Of The Day: Peloton Goes For A Ride

Benzinga's PreMarket Prep airs every morning from 8-9 a.m. ET. During that fast-paced, highly informative hour, traders and investors tune in to get the major news of the day, the catalysts behind those moves and the corresponding price action for the upcoming session.

On any given day, the show will cover at least 20 stocks determined by co-hosts Joel Elconin and Dennis Dick along with producer Spencer Israel.

With the pandemic lingering for well over a year, the distinction between stay-at-home issues from reopening plays has been more muddled. The question that remains for many of the stay-at-home companies is how well they will perform in the "new normal."

Before the open, three different Wall Street firms maintained their Buy ratings on Peloton Interactive Inc. PTON with price targets well above its Monday’s closing price ($106.59). The price action instigated by these analysts makes it the PreMarket Prep Stock Of The Day.

Winning Streak: After ending 2019 at $28.40, Peloton took a dive with the broad market in March. It went on to make a new all-time low at $17.70 and rebounded to end the month flat at $26.55.

Starting In April, it embarked on a nine-month winning streak that extended into January of this year. The rally finally peaked at $171.09 and sharply reversed course.

Losing Streak: As the world seemed to be pulling out of the pandemic, investors abandoned the issue. It went into a four-month losing streak that extended into May when it finally bottomed at $80.48 and rebounded to end the month at $110.31.

For the most part, it has been in a trading range over the last three months between $101.52 and $129.70, with a majority of the price action taking place at $105 and $120. In Monday’s session, the issue reached the bottom of the narrowed range, when it bottomed at $105.34 and bounced to close at $106.59.

Catalyst For Analyst Action: Before the open, the company announced the new Peloton Tread will be available in the United States, Canada and the United Kingdom beginning Aug. 30, and will be available in Germany in the fall. The new Peloton Tread combines Peloton's content and design with safety features integrated into the experience to create an efficient and engaging total body workout experience.

PreMarket Prep Take: When the issue was being covered on the show, it was trading at the $108.50 area. The author of this article, who is long shares of the issue, took the analyst action in stride and wasn't making any long-term decisions on the issue.

Instead, a potential upside daily target for the issue, if the rally was to continue, was Friday’s high ($111.02.) Also, the author wasn't expecting a rally to the next daily high from Aug. 18 ($113.90).

The full discussion on the issue from Tuesday's show can be found here:

Price Action: After an open above the top of Monday’s range ($108.05) at $110.41, it had a brief retreat to $110.09 and resumed its move higher. As of 2:50 p.m. ET, it has exceeded Friday’s high but has come up shy of the other daily high mentioned, reaching $113.47 at press time.