Bernstein reiterates Market Perform rating on Peloton stock with $7.50 target

Investing.com - Bernstein SocGen Group maintained its Market Perform rating on Peloton Interactive (NASDAQ:PTON) with a price target of $7.50, close to the current trading price of $7.11. According to InvestingPro analysis, the stock appears slightly undervalued based on its Fair Value assessment.

The research firm highlighted Peloton’s recent quarterly performance, which exceeded expectations with a 5% revenue beat and better-than-anticipated customer retention metrics. The company also posted stronger-than-expected margins in the reporting period.

Bernstein noted this financial performance resulted in Peloton’s first positive earnings per share since December 2020, marking a significant milestone for the fitness technology company.

Looking ahead, Peloton expects revenue growth in the second through fourth quarters, primarily driven by price realization. However, subscription growth is projected to remain negative due to macroeconomic factors and soft demand.

While acknowledging improvements in Peloton’s business health, Bernstein expressed uncertainty about the company’s path to sustainable growth, which appears to be the key factor behind maintaining the neutral Market Perform rating.

In other recent news, Peloton Interactive reported strong financial results for the fourth quarter of fiscal 2025. The company achieved an earnings per share of $0.05, surpassing the forecasted EPS of -$0.05. Additionally, Peloton’s revenue exceeded expectations, reaching $607 million compared to the anticipated $580.54 million. The company’s adjusted EBITDA for the quarter was $140 million, significantly higher than Telsey Advisory Group’s forecast of $85 million. This performance was attributed to strong execution, cost savings, and higher-than-expected hardware sales.

Goldman Sachs upgraded Peloton’s stock from Neutral to Buy, raising its price target to $11.50 from $7.00. The upgrade was based on new management initiatives aimed at platform growth and monetization. Telsey Advisory Group maintained its Market Perform rating with an $8.00 price target, noting the company’s strong execution and cost-saving measures. These developments reflect positive sentiment from analysts regarding Peloton’s future prospects.

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