UBS bullish on Planet Fitness in new fitness sector coverage

Published 17/10/2025, 19:16
© Reuters.

Investing.com -- UBS initiated coverage of U.S. fitness companies with Buy ratings on Planet Fitness and Lifetime Group Holdings, on scalable business models and structural consumer shifts toward health and wellness.

Xponential Fitness and Topgolf Callaway Brands were rated Neutral.

UBS said Planet Fitness’s asset-light, affordable model is positioned to deliver durable growth despite concerns about lower-income consumers.

The firm estimates $208 million to $245 million in EBITDA upside by 2027, with new unit openings and Black Card price increases as catalysts.

Its $125 price target reflects 17-18 times EV/EBITDA, a discount to historical averages.

Lifetime was highlighted for its premium positioning, recurring revenue growth of 10-12% and an expected 14-15% EBITDA CAGR through 2027.

UBS said pipeline depth supports accelerated openings and improving cash flow conversion, assigning a $43 target based on 10-11 times EV/EBITDA.

Whereas UBS flagged risks to Xponential’s 10% net unit growth guidance, forecasting flat revenues in 2026, and set a price target of $8.

It also noted challenges for Topgolf Callaway, where declining same-store sales offset resilience in the core golf business, giving the stock a $10 target.

UBS said consumer demand for health and wellness has risen sharply, with 82% of Americans ranking it a top priority versus 50% in 2022, creating long-term growth opportunities for companies with scalable models.

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