Stifel raises Planet Fitness stock rating, target to $120

On Thursday, Stifel analysts upgraded Planet Fitness (NYSE:PLNT) stock from Hold to Buy, setting a new price target of $120, up from the previous $82. Currently trading at $104.06, the stock sits near its 52-week high of $110, with analyst targets ranging from $82 to $150. The upgrade follows an evaluation of the company’s recent performance and potential growth catalysts, supported by nine analysts recently revising their earnings estimates upward according to InvestingPro. Stifel’s analysts pointed to stabilized gross joins and several factors that could drive comparable sales to mid-to-high single-digit growth over the next few years.

Planet Fitness has been focusing on improving its marketing strategies, which analysts believe could be further optimized for better results. With an impressive "GREAT" financial health score from InvestingPro, the company is well-positioned to execute these initiatives. In addition, Stifel anticipates that the company will increase Black Card (BC) pricing, estimating this could add a 3-4% point benefit to comparable sales (comps).

The company’s efforts to enhance the Black Card Spa experience were also noted as a positive move. With robust gross profit margins of nearly 60% and revenue growth exceeding 10% in the last twelve months, this initiative is part of Planet Fitness’s broader strategy to improve its overall service offerings and customer satisfaction.

Furthermore, the potential legislative change dubbed the "One, Big, Beautiful Bill," currently under consideration by the House, could create additional growth opportunities for Planet Fitness. If passed, the bill would allow gym memberships to be considered an eligible expense for Health Savings Accounts (HSAs), which could lead to an increase in memberships.

Based on these factors, Stifel has raised its comp and unit growth estimates for Planet Fitness, expecting consistent member growth and a multi-year pricing tailwind to drive the company’s performance in the foreseeable future.

In other recent news, Planet Fitness reported its first-quarter 2025 earnings, showing a revenue increase of 11.5% year-over-year to $276.7 million. However, the company’s earnings per share (EPS) fell short of expectations, coming in at $0.59 compared to the forecasted $0.62. Despite this, the company opened 19 new clubs globally, expanding its footprint to 2,741 locations. Analyst Max Rakhlenko from TD Cowen maintained a Buy rating on Planet Fitness, setting a price target of $125, citing strong membership growth and favorable trends. The company’s annual meeting saw stockholders approve the 2025 Omnibus Incentive Plan and amendments to the company’s charter, including the removal of supermajority voting requirements. Three directors were elected for three-year terms, and KPMG LLP was ratified as the independent auditor for the fiscal year. These developments highlight Planet Fitness’s ongoing efforts to strengthen its corporate governance and growth strategy.

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