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Tuesday, Planet Fitness (NYSE:PLNT) shares maintained their Overweight rating and $98.00 price target from JPMorgan. The firm's analysis highlighted the stock's resilience, noting a 45% return since the first quarter of 2024, outperforming the S&P 500 and Russell 1000 Index, which both saw a loss of approximately 2% in the same period. Despite a year-to-date decline of 7% in Planet Fitness stock compared to a roughly 14% drop in the S&P 500 and Russell 1000 Index, JPMorgan remains confident in the company's new growth models.
The positive outlook is based on the expectation that Planet Fitness can sustain a strong growth trajectory with mid-single-digit or higher comparable sales and development driving low double-digit revenue and EBITDA growth. This, in turn, is anticipated to result in low to mid-teens growth in earnings per share. While trading at a P/E ratio of 45.79, JPMorgan advises investors to maintain their positions in Planet Fitness shares and consider buying more if the price approaches approximately $90, in relation to the firm's December 2026 price target of $98.
During the first quarter of 2025 earnings call, Planet Fitness management is expected to provide further insights into membership trends across different demographics, the company's resilience to potential economic challenges, and the economics of franchise units in light of potential tariff impacts. Additionally, updates on the click-to-cancel ruling, its implementation, and a broader strategy update are anticipated as new executive team members settle into their roles.
Investors are also invited to a meeting on May 28 at the Planet Fitness headquarters in New Hampshire, where they will have the opportunity to engage with CEO Collen Keating, COO Bill Bode, and CFO Jay Stasz. The event is expected to offer a deeper understanding of the company's direction and operations.
In other recent news, Planet Fitness has garnered attention with several notable developments. The company reported stronger-than-expected fourth-quarter earnings, with equipment revenue seeing a 49% increase year-over-year. However, guidance for same-store sales growth in the upcoming year was slightly below consensus expectations, leading RBC Capital Markets to lower its price target from $120 to $110 while maintaining an Outperform rating. In contrast, BMO Capital Markets raised its price target to $110, citing confidence in the company's growth outlook and strategic initiatives.
Additionally, Planet Fitness announced an amendment to its corporate bylaws, introducing proxy access for stockholders, effective March 2025. This change allows stockholders to nominate director candidates, reflecting a broader trend of enhancing stockholder rights. Meanwhile, DA Davidson maintained a Neutral rating with a price target of $87, noting the company's expected 10% revenue growth for 2025, though EBITDA growth is projected to fall short of consensus estimates.
TD Cowen continues to hold a Buy rating with a $125 price target, expressing confidence in Planet Fitness's potential despite recent guidance-related concerns. The firm highlighted the introduction of the 'Click To Cancel' feature, which management expects to be fully implemented by April. This feature is anticipated to cause a temporary increase in membership churn but is not expected to significantly impact comparable store sales. These developments showcase Planet Fitness's ongoing efforts to enhance its business model and engage with investors.
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