Planet Fitness: Franchise Model Resilience and Accelerating Unit Growth Support Buy Rating

Analyst Arpine Kocharyan from UBS maintained a Buy rating on Planet Fitness and keeping the price target at $125.00.

Arpine Kocharyan has given his Buy rating due to a combination of factors that, in her view, support attractive long‑term growth and returns for Planet Fitness. She points to the company’s ability to drive mid‑single‑digit same‑store sales growth, with pricing—particularly from the Black Card tier—playing a meaningful role alongside steady traffic gains. Additionally, she highlights management’s focus on optimizing Area Development Agreements (ADAs), which includes pruning underperforming commitments and reallocating territories to stronger or incumbent franchisees, thereby reinforcing the health and productivity of the development pipeline.

Kocharyan also sees upside in Planet Fitness’s planned acceleration of unit growth, with guidance implying an increase in annual club openings as real estate availability improves and franchisees resume expansion post‑COVID. She notes that the franchise base is diversified, with the largest groups holding a modest share of total clubs, which limits concentration risk while still enabling scaled operators to drive growth. Combined with solid cash generation and leverage that remains manageable relative to EBITDA, these dynamics underpin her positive view that the current share price does not fully reflect Planet Fitness’s long‑term growth trajectory and franchise model resilience.

Kocharyan covers the Consumer Cyclical sector, focusing on stocks such as Planet Fitness, Topgolf Callaway Brands, and Hasbro. According to TipRanks, Kocharyan has an average return of 1.8% and a 54.84% success rate on recommended stocks.