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The Gym Group PLC (GB:GYM)
LSE:GYM

The Gym (GYM) AI Stock Analysis

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GB

The Gym

(LSE:GYM)

Rating:71Outperform
Price Target:
162.00p
▲(6.02%Upside)
The Gym Group demonstrates strong technical momentum and positive corporate events, driving confidence in future growth. While financial recovery is evident, high leverage and a high P/E ratio pose risks. Strategic expansion and insider buying are significant positives.
Positive Factors
Earnings
EPS is projected to increase significantly.
Financial Performance
An increase in ROIC of mature sites to 25% in FY24 indicates improved financial performance.
Growth and Expansion
12 new sites opened with 14-16 targeted for future expansion, indicating growth and expansion efforts.
Negative Factors
Interest Costs
Interest costs are slightly higher than previously expected.
Price Target
The DCF-based price target remains unchanged at 180p.

The Gym (GYM) vs. iShares MSCI United Kingdom ETF (EWC)

The Gym Business Overview & Revenue Model

Company DescriptionThe Gym Group plc operates a chain of health and fitness facilities in the United Kingdom. As of December 31, 2021, it operated 202 gym sites under The Gym Group brand. The company was founded in 2007 and is based in Croydon, the United Kingdom.
How the Company Makes MoneyThe Gym Group primarily generates revenue through its membership subscriptions, which offer customers various tiers and levels of access to its fitness facilities. Key revenue streams include monthly membership fees, pay-as-you-go options, and ancillary services like personal training sessions and specialized fitness classes. The company also benefits from partnerships with fitness brands and health-focused companies, which may include joint marketing efforts or exclusive product offerings. Additionally, The Gym Group leverages strategic locations and competitive pricing to maximize member acquisition and retention, contributing to its overall profitability.

The Gym Financial Statement Overview

Summary
The Gym has shown impressive financial recovery with strong revenue growth and improved profitability. However, high leverage and potential risks associated with debt levels require careful management.
Income Statement
75
Positive
The Gym has demonstrated a strong recovery with a significant increase in revenue from 2023 to 2024, growing by 10.98%. Gross profit margin remains robust, and the company has improved its net income position from a loss to a profit. EBIT and EBITDA margins are healthy, indicating operational efficiency. However, historical volatility in net income highlights some underlying risks.
Balance Sheet
65
Positive
The balance sheet shows a high debt-to-equity ratio, indicating significant leverage, which poses potential risks. The equity ratio is moderate, reflecting an average reliance on equity financing. Return on equity has improved as the company returned to profitability, but the high level of total debt warrants caution.
Cash Flow
70
Positive
The Gym's cash flow is strong with substantial operating cash flow growth and positive free cash flow. The free cash flow to net income ratio is favorable, highlighting effective cash conversion. However, fluctuations in capital expenditures and high debt levels may impact future cash flow stability.
BreakdownDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue226.30M204.00M172.90M106.00M80.47M
Gross Profit223.40M201.20M111.40M51.60M29.42M
EBITDA83.40M70.80M56.20M25.10M16.29M
Net Income4.40M-8.40M-19.30M-35.40M-36.37M
Balance Sheet
Total Assets585.60M571.50M595.60M564.70M532.49M
Cash, Cash Equivalents and Short-Term Investments3.00M1.50M5.40M7.30M3.74M
Total Debt401.80M398.10M420.40M380.60M355.50M
Total Liabilities454.00M443.50M461.60M412.60M378.04M
Stockholders Equity131.60M128.00M134.00M152.10M154.44M
Cash Flow
Free Cash Flow55.10M55.80M19.40M11.40M-15.79M
Operating Cash Flow95.10M79.50M63.10M37.10M13.46M
Investing Cash Flow-39.50M-23.40M-48.70M-25.70M-30.21M
Financing Cash Flow-54.10M-60.00M-16.30M-7.80M17.89M

The Gym Technical Analysis

Technical Analysis Sentiment
Positive
Last Price152.80
Price Trends
50DMA
145.62
Positive
100DMA
139.20
Positive
200DMA
146.62
Positive
Market Momentum
MACD
1.90
Negative
RSI
63.07
Neutral
STOCH
90.37
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GB:GYM, the sentiment is Positive. The current price of 152.8 is above the 20-day moving average (MA) of 148.26, above the 50-day MA of 145.62, and above the 200-day MA of 146.62, indicating a bullish trend. The MACD of 1.90 indicates Negative momentum. The RSI at 63.07 is Neutral, neither overbought nor oversold. The STOCH value of 90.37 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GB:GYM.

The Gym Peers Comparison

Overall Rating
UnderperformOutperform
Sector (62)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
74
Outperform
£427.20M15.2118.88%0.03%7.46%-18.88%
GBJDW
73
Outperform
£831.89M14.8216.38%0.39%3.70%57.10%
72
Outperform
£513.43M60.771.27%1.79%16.73%-55.22%
GBGYM
71
Outperform
£271.83M61.123.39%10.93%
GBAO
63
Neutral
£546.74M52.516.87%-0.39%2.68%
62
Neutral
$16.72B10.85-7.48%3.11%1.66%-24.52%
60
Neutral
£513.43M39.161.27%3.73%16.73%-55.22%
* Consumer Cyclical Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
GB:GYM
The Gym
152.80
41.00
36.67%
GB:BOWL
Hollywood Bowl
253.00
-39.10
-13.39%
GB:JDW
J D Wetherspoon
773.50
60.80
8.53%
GB:YNGA
Young & Co'S Brewery
959.00
28.43
3.06%
GB:YNGN
Young & Co'S Brewery
618.00
36.78
6.33%
GB:AO
AO World
96.10
-16.50
-14.65%

The Gym Corporate Events

Business Operations and StrategyRegulatory Filings and Compliance
The Gym Group PLC Announces Major Holdings Change
Neutral
Jun 27, 2025

The Gym Group PLC has announced a change in its major holdings, with Astaris Capital Management LLP acquiring a significant portion of voting rights through financial instruments. This acquisition, facilitated through Goldman Sachs Securities, indicates a strategic move that could influence the company’s future decision-making processes and potentially impact its market positioning.

The most recent analyst rating on (GB:GYM) stock is a Hold with a £1.45 price target. To see the full list of analyst forecasts on The Gym stock, see the GB:GYM Stock Forecast page.

Business Operations and Strategy
The Gym Group Showcases Strategic Expansion at Elephant & Castle
Positive
Jun 11, 2025

The Gym Group is hosting a site visit and presentation at its Elephant & Castle gym, highlighting its strategic evolution and expansion plans. The company is accelerating its self-funded rollout, aiming to open 14-16 new gyms in 2025 and approximately 50 over three years, focusing on a scalable, cost-effective model. The Elephant & Castle site exemplifies the Group’s evolving proposition, appealing particularly to Gen Z gym-goers, and demonstrates its commitment to maintaining high-quality, low-cost fitness options.

The most recent analyst rating on (GB:GYM) stock is a Hold with a £1.45 price target. To see the full list of analyst forecasts on The Gym stock, see the GB:GYM Stock Forecast page.

Financial Disclosures
The Gym Group to Release Pre-Close Trading Update
Neutral
Jun 9, 2025

The Gym Group announced its intention to release a pre-close trading update for the first half of 2025 on July 9. This announcement is significant as it provides stakeholders with insights into the company’s financial performance and operational progress, potentially influencing market perceptions and investment decisions.

The most recent analyst rating on (GB:GYM) stock is a Hold with a £1.45 price target. To see the full list of analyst forecasts on The Gym stock, see the GB:GYM Stock Forecast page.

Regulatory Filings and Compliance
The Gym Group PLC Announces Total Voting Rights Update
Neutral
Jun 2, 2025

The Gym Group PLC announced that as of May 31, 2025, its issued share capital consists of 179,332,517 ordinary shares, each with one vote, and holds no shares in treasury. This information is crucial for shareholders to calculate their interests according to the UKLA’s Disclosure Guidance and Transparency Rules, impacting how they manage their investments in the company.

The most recent analyst rating on (GB:GYM) stock is a Hold with a £1.45 price target. To see the full list of analyst forecasts on The Gym stock, see the GB:GYM Stock Forecast page.

Executive/Board ChangesShareholder Meetings
The Gym Group Successfully Passes All AGM Resolutions Amid Shareholder Engagement
Neutral
May 8, 2025

The Gym Group plc announced that all resolutions at its recent Annual General Meeting were passed, including the re-election of several directors and the approval of the Directors’ Remuneration Report. Notably, the re-election of John Treharne as a director received over 20% opposition, prompting the company to engage with shareholders for further discussions. This outcome reflects the company’s ongoing commitment to governance and shareholder engagement, potentially impacting its strategic direction and stakeholder relations.

Regulatory Filings and Compliance
The Gym Group Announces Total Voting Rights Update
Neutral
May 1, 2025

The Gym Group PLC announced that as of April 30, 2025, its issued share capital consists of 179,322,111 ordinary shares, each with one vote, and no shares held in treasury. This information is crucial for shareholders to determine their voting rights and obligations under the UKLA’s Disclosure Guidance and Transparency Rules.

Other
The Gym Group CEO Acquires Significant Shareholding
Positive
Apr 30, 2025

The Gym Group plc announced a transaction involving its CEO, Will Orr, who acquired 14,385 ordinary shares at a price of £1.400599 per share, totaling £20,147.62. This acquisition, conducted off-exchange on April 29, 2025, reflects a significant investment by the CEO, potentially signaling confidence in the company’s future performance and stability.

Business Operations and Strategy
The Gym Group Relocates Headquarters to London
Neutral
Apr 28, 2025

The Gym Group has announced a change in its registered and head office addresses, moving from Croydon to a new location in London, effective April 28, 2025. This relocation may reflect strategic positioning within the industry, potentially enhancing operational efficiencies and aligning with business growth objectives.

Other
The Gym Group CEO Acquires Significant Shareholding
Positive
Apr 22, 2025

The Gym Group PLC announced a transaction involving its CEO, Will Orr, who acquired 22,000 ordinary shares at a price of £1.368 per share, totaling £30,096.00. This acquisition, conducted off-exchange on April 16, 2025, reflects a significant investment by the CEO, potentially signaling confidence in the company’s future performance and aligning executive interests with those of shareholders.

Shareholder MeetingsFinancial Disclosures
The Gym Group Releases 2024 Annual Report and AGM Notice
Neutral
Apr 8, 2025

The Gym Group has announced the release of its Annual Report and Accounts for the year ended 31 December 2024, along with the Notice of its Annual General Meeting (AGM) scheduled for 8 May 2025. These documents have been made available to shareholders and submitted to the National Storage Mechanism for public inspection. This announcement is part of the company’s ongoing commitment to transparency and shareholder engagement, potentially impacting its market positioning by reinforcing trust and communication with stakeholders.

Regulatory Filings and Compliance
The Gym Group PLC Updates Share Capital and Voting Rights
Neutral
Apr 1, 2025

The Gym Group PLC announced that as of March 31, 2025, its issued share capital consists of 179,307,108 ordinary shares, each carrying one vote. This update is significant for shareholders as it determines the denominator for calculating their interests under the UKLA’s Disclosure Guidance and Transparency Rules.

Executive/Board Changes
The Gym Group Appoints Tamsin Todd as Non-Executive Director
Positive
Mar 28, 2025

The Gym Group has announced the appointment of Tamsin Todd as a Non-Executive Director, effective from May 1, 2025. Tamsin brings a wealth of experience in business strategy, product management, and technology, having held significant roles at companies like Auction Technology Group, Findmypast, and TUI Group. Her expertise is expected to contribute significantly to The Gym Group’s board, particularly in supporting innovation and growth, which will benefit both customers and shareholders.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Jun 11, 2025