Shares of Peloton (PTON) are rising in today’s trading after five-star Argus analyst John Staszak upgraded the fitness equipment maker to a Buy due to increased interest in fitness equipment and cost-saving measures. The analyst is also confident in the new CEO’s ability to turn the company around. Indeed, Staszak believes that these factors will contribute to a narrower loss in Fiscal Year 2025 and has set a $15 price target, which represents a 72% upside from the current price.
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Peloton’s new CEO, Peter Stern, brings valuable experience in the health and fitness industry. As a result, Staszak expects the company to reduce debt, revive subscriber growth, and increase customer retention. His optimism comes despite Peloton’s struggles to gain new connected fitness subscribers, which led to a 9% year-over-year revenue decline in the latest quarter.
Nevertheless, Peloton’s shares have been rallying thanks to the company’s cost-cutting efforts and raised adjusted EBITDA outlook. In addition, Staszak revised his loss forecasts for the company and now expects EPS of -$0.40 in FY25 and -$0.25 in FY26. This is better than the previous estimate of -$0.45 for the former and -$0.30 for the latter.
What Is the Future of PTON Stock?
Turning to Wall Street, analysts have a Hold consensus rating on PTON stock based on three Buys, 14 Holds, and zero Sells assigned in the past three months, as indicated by the graphic below. After an 81% rally in its share price over the past year, the average PTON price target of $10.17 per share implies 16.6% upside potential.
