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Bank of America is positive on Peloton Interactive (NASDAQ:PTON) ahead of the company's earnings report on February 1.
The firm thinks the FQ2 report from the New York City-based exercise equipment giant could show slightly better-than-feared subscriber, visitation, and churn numbers. The conference call is seen as key with management's set to update on holiday sales and the impact of discounts, distribution partnerships with Amazon and Dick’s, and rower sales.
Analyst Justin Post said the firm's Buy thesis on Peloton (PTON) stock is that 2022 was a peak year for reopening and competitive headwinds. He also noted that there is value in the subscriber base given low churn and opportunity for margin improvement. Looking ahead, getting PTON's hardware business to break-even and subscriber to growth mode are caleld potential valuation catalysis.
BofA boosted its price objective on Buy-rated PTON to $16 from $14.
Peloton Interactive (PTON) gained 2.06% in Thursday morning trading with earnings less than a week away. Options trading implies a double-digit share price move when the PTON report drops. Short interest on the stock is down to 14% of total float, but still high enough to add an extra dose of volatility.