Peloton (PTON) Stock Sinks As Market Gains: What You Should Know

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Peloton (PTON) closed at $112.09 in the latest trading session, marking a -0.31% move from the prior day. This change lagged the S&P 500’s 1.18% gain on the day. Elsewhere, the Dow gained 0.52%, while the tech-heavy Nasdaq added 1.76%.

Coming into today, shares of the exercise bike and treadmill company had gained 4.03% in the past month. In that same time, the Consumer Discretionary sector lost 1.41%, while the S&P 500 gained 4.55%.

PTON will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $0.10, up 150% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $1.11 billion, up 112.54% from the prior-year quarter.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $0.30 per share and revenue of $4.1 billion. These totals would mark changes of +193.75% and +124.64%, respectively, from last year.

Investors should also note any recent changes to analyst estimates for PTON. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company’s business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. PTON currently has a Zacks Rank of #3 (Hold).

Digging into valuation, PTON currently has a Forward P/E ratio of 371.09. This valuation marks a premium compared to its industry’s average Forward P/E of 14.83.

The Leisure and Recreation Products industry is part of the Consumer Discretionary sector. This industry currently has a Zacks Industry Rank of 19, which puts it in the top 8% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.

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